Zoho Books Practice Session

Hands-on, step-by-step exercises to master every core feature of Zoho Books.

1. Introduction to Zoho Books

Exercise 1.1: Dashboard Overview

Objective: To understand and interpret the key information presented on the Zoho Books dashboard.

  1. Log in to your Zoho Books organization.
  2. Identify the "Total Receivables" and "Total Payables" widgets.
  3. Locate the "Cash Flow" chart.
  4. Find the "Income and Expense" widget and note the figures.

Exercise 1.2: Core Module Navigation

Objective: To confidently navigate between the core modules using the left-hand panel.

  1. Use the left navigation panel to go to Sales > Customers.
  2. Navigate to Purchases > Bills.
  3. Go to Items > Items.
  4. Navigate to Reports > Accountant > Profit and Loss.

2. Company Setup & Basic Configurations

Exercise 2.1: Create & Configure New Organization

Scenario: You are the accountant for a new startup, "Tirupati Tech Solutions," based in Tirupati.

  1. Create a new organization named Tirupati Tech Solutions.
  2. During setup, set the business location to Andhra Pradesh, India.
  3. Enter the company address: 19-8-114/A1, Kora Towers, Air Bypass Rd, Tirupati, 517501.
  4. Set the Financial Year to start on April 1st and confirm currency is INR.

Exercise 2.2: User Roles & Permissions

Scenario: "Tirupati Tech Solutions" has hired a new sales executive. You need to provide them with appropriate access.

  1. Navigate to Settings > Users & Roles.
  2. Invite a new user with the email sales.exec@tirupatitech.in and assign them the predefined "Sales Person" role.

3. Chart of Accounts & Items

Exercise 3.1: Expanding the Chart of Accounts

Scenario: The company needs more specific ledgers to categorize its transactions accurately.

  1. Go to Accountant > Chart of Accounts and click "+ New Account".
  2. Create a new Expense account named Rent Expense.
  3. Create a new Fixed Asset account named Computer Equipment.

Exercise 3.2: Adding Services and Inventory Items

Scenario: "Tirupati Tech Solutions" sells hardware and provides repair services.

  1. Navigate to Items > Items and add a new Service.
  2. Name it Computer Repair Service (Hourly), with a selling price of ₹800.
  3. Now, add a new Good (Inventory Item) named Dell Inspiron Laptop.
  4. Check "Track Inventory", set Cost Price to ₹45,000, Selling Price to ₹52,000, and an Opening Stock of 10 units.

4. Customers & Vendors

Exercise 4.1: Adding Customers and Vendors

Scenario: Add records for a new key customer and a primary supplier.

  1. Navigate to Sales > Customers > + New. Add "Prakasham Steel Corp" from Ongole, AP.
  2. Set their Payment Terms to "Net 30".
  3. Navigate to Purchases > Vendors > + New. Add "Delta Computers" from Vijayawada.

Exercise 4.2: Credit Limits and Portals

  1. Go to the customer record for "Prakasham Steel Corp".
  2. Set a Credit Limit of ₹2,00,000.
  3. Under "More" actions, select "Configure Customer Portal" and enable it.

5. Sales Module

Exercise 5.1: Create an Estimate

Scenario: "Prakasham Steel Corp" has requested a formal quote for 5 new laptops.

  1. Go to Sales > Estimates and create a new estimate for "Prakasham Steel Corp".
  2. Add a line item for 5 units of the Dell Inspiron Laptop. Save it.

Exercise 5.2: Convert to Sales Order

Scenario: The customer has approved the estimate. Confirm the sale.

  1. Open the estimate you created and click "Convert to Sales Order". Verify details and save.

Exercise 5.3: Convert to Invoice

Scenario: The laptops have been delivered. Bill the customer.

  1. Open the Sales Order and click "Convert to Invoice". Check the dates and terms, then save.

Exercise 5.4: Record Payment & Issue Credit Note

Scenario: You received a payment, but the customer returned one damaged item.

  1. Open the invoice for "Prakasham Steel Corp" and "Record Payment" for an advance of ₹1,00,000.
  2. Go to Sales > Credit Notes and create a credit note for 1 returned laptop.
  3. Apply this credit note to their outstanding invoice.

6. Purchase Module

Exercise 6.1: Create Purchase Order

  1. Create a new Purchase Order for "Delta Computers" to buy 15 Dell Inspiron Laptop units.

Exercise 6.2: Create Bill from PO

  1. Open the Purchase Order and "Convert to Bill". Enter a bill number and save.

Exercise 6.3: Record Expense

  1. Go to Purchases > Expenses and record an expense of ₹15,000 for Rent Expense.

7. Banking & Reconciliation

Exercise 7.1: Add Bank & Import Statement

  1. Add a new bank account manually: HDFC Current A/c - Tirupati.
  2. Click the button below to download the sample bank statement.
  4. In your new bank account, import the statement.

Exercise 7.2: Reconcile Account

  1. Find the deposit of ₹1,00,000 and match it with the payment from "Prakasham Steel Corp".
  2. Find the withdrawal of ₹15,000 and categorize it under the Rent Expense account.
  3. After handling all transactions, go to Reconcile Account, enter a closing balance, and complete the reconciliation.

8. GST & Compliance

Exercise 8.1: GST Invoice Types

  1. Create a B2B invoice for "Prakasham Steel Corp" (intra-state). Observe that CGST & SGST are applied.
  2. Create a new B2B customer, "Bangalore Traders" (Karnataka), and create an invoice for them (inter-state). Observe that IGST is applied.

Exercise 8.2: GST Reports & TDS

  1. Navigate to Reports > Taxes and generate the GSTR-1 report.
  2. Create a bill for professional services of ₹50,000 and deduct TDS at the applicable rate.

9. Reports & Analytics

Exercise 9.1: Financial & Sales Reports

  1. Generate the Profit & Loss report for the current financial year.
  2. Run the Balance Sheet report as of today's date.
  3. Generate the Accounts Receivable Aging report to identify overdue invoices.

Exercise 9.2: Customizing & Scheduling Reports

  1. Run a Sales by Item report.
  2. Click "Customize Report" and add a filter for the last 30 days.
  3. Save this as a new custom report named "Monthly Item Sales".
  4. Schedule the report to be emailed to you every Monday morning.

10. Revision Case Study

Case Study: "Tirumala Textiles"

Scenario: Handle the books for "Tirumala Textiles" from Tirupati, who sells fabrics to domestic corporations.

  1. Setup: Create a customer "Mumbai Fashion House" (Maharashtra) and an inventory item "Pattu Silk Fabric" (Selling Price: ₹4,000/meter).
  2. Sales Cycle: Invoice "Mumbai Fashion House" for 100 meters of fabric. Note the IGST application.
  3. Purchase Cycle: Create a bill from a local vendor "Tirupati Weavers" for 100 meters of the fabric at a cost of ₹2,000/meter.
  4. Payments: Record payments for the bill and the invoice.
  5. Reporting: Generate a Profit and Loss report. What is the net profit from this cycle?

Frequently Asked Questions

What do the Zoho Books practice exercises cover?

Ten modules: introduction, company setup, chart of accounts and items, customers and vendors, sales, purchases, banking and reconciliation, GST and compliance, reports, and a revision case study.

Do I need a Zoho Books account to practise?

Yes. You need a Zoho Books organisation to work in. Zoho offers a free trial you can use for practice.

Is there a full Zoho Books course?

Yes. Zoho Books is a module of the Certified Professional Accountant program, and there is also a Zoho Books masterclass.