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Excel Tutorial to Improve Your Efficiency

Introduction

My purpose with this Excel tutorial is to illustrate some Excel tips that will dramatically improve your efficiency. I make no attempt to be as encyclopedic as some of the 800-page Excel manuals available. I concentrate on common tasks, not every last thing that can be done in Excel. Also, I presume that you have some Excel knowledge. For example, I assume you know about rows and columns, values, labels, and formulas, relative and absolute addresses, and other basic Excel elements. If you know virtually nothing about Excel, you probably ought to work through an “Excel for Dummies” book and then work through this tutorial.

The style of this tutorial should be easy to follow. Main topics appear in bold black type.

Specific direction headings are in yellow, and these are followed by detailed directions in red. Additional comments about the directions appear in blue. Then there are “Try it!” exercises in green. These “Try it!” exercises are a key feature of this tutorial. I have embedded numerous sample Excel spreadsheets so that you can try out the directions right away—without switching into Excel. When you double-click on one of these spreadsheets, you launch Excel, and the spreadsheet “comes alive.” The menus and toolbars even change to those for Excel. By clicking outside one of these spreadsheets, you’re back in Word.

A few of the topics are best carried out on your own PC (as opposed to your school’s networked PCs), and I haven’t included sample spreadsheets for these. The reason is that they change the way a specific copy of Excel is set up. If you do one of these exercises on your school’s networked PCs, the chances are that they won’t take effect, at least not permanently, because of the way Excel is set up on the network. These topics have been placed at the end and are preceded by asterisks. Try them on your own home PC, where you have complete control.

The easiest way to maneuver around this tutorial is to switch to outline view. To do so, select Word’s View?Outline menu item, which gives you an extra Outline toolbar. This toolbar has two dropdown lists. The right one, called Show Level, lets you choose the level of the outline. You’ll get good results by choosing Level 2. This lets you see all first-level and second-level headings. Put your cursor on a heading of interest and then switch back to normal view by selecting Word’s View?Print Layout menu item. (Try it right now. It’s easy!)

Finally, I suggest that you save this file–RIGHT NOW–as (or some such name) and work with the copy. That way, if you mess anything up as you try the exercises, you can always go back and retrieve the original file ().

Have fun!

Basic Spreadsheet Tasks

This section illustrates a number of ways to make you more efficient: how to select ranges, how to copy and paste, how to deal with absolute and relative addresses, how to insert and delete rows or columns, and a few others. Most Excel users know how to do these things, but they often do them inefficiently. So even though this material might seem elementary, read on—you might just pick up a few tricks you weren’t aware of.

Moving to the Top of the Sheet

Often you want to reorient yourself by going back to the “home” position on the worksheet.

To go to the top left of the sheet (cell A1):

Press Ctrl-Home (both keys at once).

Try it!

 
             
             
             
             
   

Down in the midst of the worksheet

 
             
             
             
             
             

Using End-Arrow Key Combinations

To go to the end of a range (top, bottom, left, or right):

Press the End key, then the appropriate arrow key. For example, press End and then right arrow to go to the right edge of a range.

Try it! Starting at a corner (a bordered cell), move around to the other corners.

 
             
             
   

8

1

1

1

 
   

5

5

7

6

 
   

10

5

3

10

 
   

10

10

5

9

 
   

5

4

3

4

 
   

7

4

5

1

 
   

2

8

9

10

 
             

The action of an End-arrow combination depends on where you start. It takes you to the last nonblank cell if you start in a nonblank cell. (If there aren’t any nonblank cells in that direction, it takes you to the far edge of the sheet.) If you start in a blank cell, it takes you to the first nonblank cell.

Splitting the Screen

It is often useful to split the screen so that you can see more information.

To split the screen vertically, horizontally, or both:

Click on the narrow “screen splitter” bar just to the right of the bottom scroll bar (for vertical splitting) or just above the right-hand scroll bar (for horizontal splitting) and drag this to the left or down.

Splitting gives you two “panes” (or four if you split in both directions). Once you have these panes, practice scrolling around in any of them, and see how the others react.

Try it! Split the screen either way and then remove the split.

 

Selecting a Range

Usually in Excel, you select a range and then do something to it (such as enter a formula in it, format it, delete its contents, and so on). Therefore, it is extremely important to be able to select a range efficiently. It’s easy if the whole range appears on the screen, but it’s a bit trickier if you can’t see the whole range. In the latter case the effect of dragging (the method most users try) can be frustrating–things scroll by too quickly. Try one of the methods below instead.

To select a range that fits on a screen:

Click on one corner of the range and drag to the opposite corner.

Or:

Click on one corner, hold down the Shift key, and click on the opposite corner.

Try it! Select the range B2:D7.

 
             
 

9

2

10

     
 

1

3

8

     
 

8

1

10

     
 

7

5

4

     
 

5

1

1

     
 

5

10

7

     
             
             
             

To select a range doesn’t fit on a screen:

Click on one corner of the range, say, the upper left corner. Then, holding the Shift key down, use the End-arrow combinations (End and right arrow, then, if necessary, End and down arrow) to get to the opposite corner.

Or:

Split the screen so that one corner shows in one pane and the opposite corner shows in the other pane. Click on one corner, hold the Shift key down, and click on the opposite corner.

Try it! Select the range B2:C100 or the range E2:N5. Try both of the methods suggested above.

 
             
 

6

3

 

7

13

9

 

7

2

 

5

6

11

 

1

3

 

1

2

9

 

6

4

 

9

13

1

 

4

4

       
 

2

7

       
 

2

4

       
 

2

2

       
 

8

6

       

Selecting Multiple Ranges

Say you want to format more than one range in a certain way (as currency, for example). The quickest way is to select all ranges at once and then format them all at once.

To select more than one range:

Select the first range, press the Ctrl key, select the second range, press the Ctrl key, select the third range, and so on.

For example, to select the ranges B2:D5 and F2:H5, click on B2, hold down the Shift key and click on D5 (so now the first range is selected), hold down the Ctrl key and click on F2, and finally hold down the Shift key and click on H5.

Try it! Select all three numerical ranges shown.

 
             
 

10

13

 

7

9

 
 

1

9

 

12

7

 
 

5

4

 

1

1

 
       

6

12

 
       

15

2

 
             
             
   

13

4

10

   
             

Copying and Pasting

Copying and pasting (usually formulas) is one of the most frequently done tasks in Excel, and it can be a real time-waster if done inefficiently. Many people do it as follows. They select the range to be copied (often in an inefficient manner), then select the Edit?Copy menu item, then select the paste range (again, often inefficiently), and finally select the Edit?Paste menu item. There are much better ways to get the job done!

To copy and paste using keyboard shortcuts:

Select the copy range (using one of the efficient selection methods described above), press Ctrl-c (for copy), select the paste range (again, efficiently), and press Ctrl-v (for paste). (If you practice pressing Ctrl-c or Ctrl-v with the little finger and index finger of your left hand, it will become automatic in a short time.)

The copy range will still have a dotted line around it. Press the Esc key to get rid of it.

Try it! Copy the formula in cell C2 down through cell C8 using Ctrl-c and Ctrl-v.

 
             

3

3

9

       

4

1

         

2

3

         

2

1

         

5

1

         

4

2

         

3

5

         
             
             

To copy and paste using toolbar buttons:

Proceed as above, but use the copy and paste toolbar buttons (on the top toolbar) instead of the Ctrl-c and Ctrl-v key combinations.

Try it! Copy the formula in C2 down through cell C8 using the Copy and Paste buttons.

 
             

1

3

3

       

4

1

         

5

5

         

1

4

         

3

3

         

3

5

         

1

5

         
             
             

Buttons or key combinations? This is a matter of personal taste, but either is quicker than menu choices!

A frequent task is to enter a formula in one cell and copy it down a row or across a column. There are several very efficient ways to do this.

To avoid copying and pasting altogether, use Ctrl-Enter:

Starting with the top or left-hand cell, select the range where the results will go. (Use the selection methods described earlier, especially if this range is a long one.) Type in the formula, and press Ctrl-Enter instead of Enter.

Try it! Fill up the range C2:C8 with Ctrl-Enter.

 

Pressing Ctrl-Enter enters what you typed in all of the selected cells (adjusted for relative addresses), so in general, it can be a real time saver. For example, it could be used to enter the number 10 in a whole range of cells. Just select the range, type 10, and press Ctrl-Enter.

Try it! Fill up the range B2:D8 with the value 10 by using Ctrl-Enter.

 

To copy with the drag handle:

Enter the formula in the top or left-hand cell of the intended range. Place the cursor on the “drag handle” at the lower right of this cell (the cursor becomes a plus sign), and drag this handle down or across to copy.

Try it! Copy the formula in C2 down through C8 with the “drag handle”.

 
             

10

7

70

       

6

9

         

4

9

         

5

1

         

2

8

         

8

10

         

10

7

         
             
             

To copy by double-clicking on the drag handle:

Enter the formula in the top or left-hand cell of the intended range. Double-click on the drag handle.

This method uses Excel’s built-in intelligence, but it works only in certain situations. Let’s say you have numbers in the range A3:B100. You want to enter a formula in cell C3 and copy it down to cell C100. Since this is a common thing to do, Excel does it for you if you double-click on the drag handle. It senses the “filled-up” range in column B and guesses that you want another filled-up range right next to it in column C. If there were no adjacent filled-up range, doubleclicking on the drag handle wouldn’t work.

Try it! Copy the formula in C2 down through C8 by double-clicking the “drag handle.”

 
             

7

8

56

       

2

1

         

10

2

         

4

1

         

4

5

         

3

8

         

7

8

         
             
             

Copying and Pasting with the Special/Values Option

Often you have a range of cells that contains formulas, and you would like to replace the formulas with the values they produce. Usually, you paste these values onto the copy range, that is, you overwrite the formulas with values. However, you could also select another range for the paste range.

To copy formulas and paste values:

Select the range with formulas, press Ctrl-c to copy, and select the range where you want to paste the values (which could be the same as the copy range). Then (since there is no keyboard equivalent) select the Edit?Paste Special menu item, and select the Values option. (I do this Paste Special?Values combination so often that I’ve memorized the keystroke equivalents: Alte, then s, then down arrow twice, then Enter.)

Try it! Copy the range D2:D8 to itself, but paste values.

 
             
 

1

1

1

     
 

2

3

6

     
 

9

5

45

     
 

7

4

28

     
 

8

8

64

     
 

8

10

80

     
 

7

6

42

     
             
             

You might want to experiment with the other options on the Edit?Paste Special dialog box. For example, if you have a set of labels entered as a row and you want this same set of labels entered somewhere else as a column, try copying and pasting special with the Transpose option.

Moving (Cutting and Pasting)

Often you would like to move information from one place in the sheet to another.

To move (cut and paste):

Select the range to be cut, press Ctrl-x (for cutting), select the upper left corner of the paste range, and press Ctrl-v. (The little finger-index finger combination in your left hand is also good for pressing Ctrl-x.)

As with copying and pasting, toolbar buttons can be used instead of key combinations, but either is more efficient than selecting menu items. Also, note that you need only select the upper left cell of the paste range. Excel knows that the shape of the paste range is the same as the shape of the cut range.

Try it! Move the range A2:C8 to the range D2:F8. (Watch how relative addresses affect the eventual formulas in column F.)

 
             

2

3

6

       

7

4

28

       

3

6

18

       

3

9

27

       

6

7

42

       

6

6

36

       

1

4

4

       
             
             

Absolute/Relative References

Absolute and references are indicated in formulas by dollar signs or the lack of them, and they indicate what happens when you copy or move a formula to a range. You typically want some parts of the formula to stay fixed (absolute) and others to change relative to the cell position. This is a crucial concept for efficiency in spreadsheet operations, so you should take some time to understand it thoroughly. Here are two important things to remember: (1) The dollar signs are relevant only for the purpose of copying or moving; they have no inherent effect on the formula. For example, the formulas =5*B3 and =5*$B$3 in cell C3, say, produce exactly the same result. Their difference is relevant only if cell C3 is copied or moved to some range. (2) There is never any need to type the dollar signs. This can be done with the F4 key.

To make a cell reference absolute or mixed absolute/relative using the F4 key:

Enter a cell reference such as B3 in a formula. Then press the F4 key.

In fact, pressing the F4 key repeatedly cycles through the possibilities: B3 (neither row nor column fixed), then $B$3 (both column B and row 3 fixed), then B$3 (only row 3 fixed), then $B3 (only column B fixed), and back again to B3.

Try it! Enter the appropriate formula in cell B7 and copy across to E7. (Scroll to the right to see the correct answer.)

 
             

Fixed cost

$50

         

Variable cost

$2

         
             

Month

Jan

Feb

Mar

Apr

   

Units produced

224

194

228

258

   

Total cost

           
             
             
             

Try it again! Enter one formula with appropriate absolute/relative addressing in cell C5 that can be copied to C5:F9. (Scroll to the right to see the correct answer.)

 

Table of re

venues for

various unit

prices and

units sold

   
             
   

Units sold

       
   

50

100

150

200

 

Unit price

$3.25

         
 

$3.50

         
 

$3.75

         
 

$4.00

         
 

$4.25

         
             

Showing Formulas in R1C1 Notation

Speaking of relative and absolute addresses in formulas, it’s pretty amazing how intelligent spreadsheets are. When you copy a formula in cell C1 such as =A1+B1 down, it automatically changes appropriately: =A2+B2, then =A3+B3, etc. In a sense, these are all the same formula. Each says to add the two values to the left of the current cell. Excel allows you to see this equivalence even better by viewing the formulas in a different format, called R1C1 notation. In this format, each of the formulas in column C is written as =RC[-2]+RC[-1]. R stands for row, and C stands for column. The fact that there is nothing next to R means we stay in the same row. The numbers in brackets next to C mean to go 2 columns to the left and 1 column to the left. (For columns, negative numbers mean to go to the left, positive to the right. For rows, negative numbers mean to go up, positive down.)

If there is a number next to R or C that is not in brackets, it indicates an absolute reference. For example, =R2C[2] placed in cell D5 is equivalent to =F2 since the row reference is absolute and the column reference is relative to column D.

The usual way of expressing formulas, such as =C5+D5, is called A1 format. The new way discussed here is called R1C1 format. You can easily toggle between them.

To toggle between A1 and R1C1 formula styles:

Select the Tools?Options menu item, click on the General tab, and check or uncheck the R1C1 reference style option.

Try it! Toggle between A1 and R1C1 reference style in the following spreadsheet, and for either, examine the formulas inside the border and in the Total row.

Multiplication table

         
   

1

2

3

4

 
 

1

1

2

3

4

 
 

2

2

4

6

8

 
 

3

3

6

9

12

 
 

4

4

8

12

16

 
 

Total

10

20

30

40

 
             
             

I have read one Excel book that advocates the use of R1C1 notation everywhere, reasoning that this notation makes more logical sense. Maybe the author has a point, but the A1 notation is so ingrained in most of us that the transition to R1C1 notation would be painful, to say the least!

Inserting and Deleting Rows or Columns

Often you want to insert or delete rows or columns. Note that deleting a row or column is not the same as clearing the contents of a row or column—making all of its cells blank. Deleting a row or column means wiping it out completely.

To insert one or more blank rows:

Click on a row number and drag down as many rows as you want to insert, and then press Alt-i and then r. (Alternatively, use the menu equivalent: Insert?Row).

The rows you insert are inserted above the first row you selected. For example, if you select rows 8 through 11 and then insert, four blank rows will be inserted between the old rows 7 and 8.

Try it! Insert blank rows for the data for Feb, Apr, and May.

 
             

Month

Price

Units sold

Revenue

     

Jan

$3.00

100

$300.00

     

Mar

$3.25

50

$162.50

     

Jun

$3.50

200

$700.00

     
             
             
             
             
             

Columns are inserted in the same way, except that the key sequence is Alt-i and then c (or the menu equivalent: Insert?Column).

Try it! Insert blank columns for sales reps Baker, Miller, and Smith (so that the sales reps are in alphabetical order from left to right).

 
             

Sales rep

Allison

Jones

Taylor

     

Commission rate

5.4%

6.5%

4.3%

     

Sales

$15,000

$12,000

$17,000

     

Commission

$810

$780

$731

     
             
             
             
             
             

To delete one or more rows:

Click on a row number and drag down as many rows as you want to delete, and then press Alt-e and then d (or the menu equivalent: Edit?Delete). Columns are deleted in exactly the same way.

Try it! The company no longer carries products K322 and R543, so get rid of their rows.

 
             

Product Code

Units sold

Unit price

       

J645

148

$15.00

       

K322

278

$17.50

       

L254

384

$25.00

       

M332

13

$30.50

       

R543

247

$22.40

       

S654

315

$35.00

       
             
             

Filling a Series

Say you want to fill column A, starting in cell A2, with the values 1, 2, and so on up to 1000. There is an easy way.

To fill a column range with a series:

Enter the first value in the first cell (1 in cell A2). With the cursor in the starting cell (A2), use the menu item Edit?Fill?Series to obtain a dialog box. Change the Row setting to Column, make sure the Type setting is Linear, make sure 1 is in the Step Value box, enter the final value (1000) in the Stop Value box, and click on OK.

As you can guess from this dialog box, many other options are possible. Don’t be afraid to experiment with them.

Try it! The series of days in column A should go from 1 to 25, in column D it should go from 26 to 50.

 

Day

Sales

 

Day

Sales

   
 

$227

   

$167

   
 

$157

   

$107

   
 

$143

   

$255

   
 

$129

   

$113

   
 

$102

   

$186

   
 

$116

   

$124

   
 

$269

   

$271

   
 

$111

   

$288

   
 

$210

   

$273

   

Summation Button

The SUM function is used so often to sum across rows or columns that a toolbar button (the ? button) is available to automate the procedure. To illustrate its use, suppose you have a table of numbers in the range B3:E7. You want the row sums to appear in the range F3:F7, and you want the column sums to appear in the range B8:E8. It’s easy. To produce row and column sums with the summation button:

Select the range(s) where you want the sums (F3:F7 and B8:E8–remember how to select multiple ranges?), and click on the summation button.

Note that if you select multiple cells, you get the sums automatically. If you select a single cell

(such as when you have a single column of numbers to sum), you’ll be shown the sum formula “for your approval” and you’ll have to press Enter to actually enter it. Why does Excel do it this way–your guess is as good as mine!

Try it! Use the summation button to fill in the row and column sums.

 
             
             
 

51

94

15

7

   
 

37

6

2

41

   
 

13

83

29

88

   
 

73

64

46

32

   
 

38

11

3

80

   
             
             
             

Transposing a Range

Often you set up a spreadsheet and then decide that you would rather have a portion of it transposed. That is, you would like to “turn it on its side,” so that rows become columns and vice versa. This is simple with one of Excel’s Paste Special options.

To transpose a range:

Select a range that you want to transpose and press Ctrl-c to copy it. Then select the upper left cell of the range where you want the transposed version to go, select the Edit?Paste Special menu item, and check the Transpose option.

Make sure there is enough room for the transposed version. For example, if the original range has

3 rows and 5 columns, the transposed version will have 5 rows and 3 columns. If you select cell D5, say, as the upper left cell for the transposed version, everything in the range D5:F9 will be overwritten by the transposed version.

Try it! Transpose the range A3:D6 to a range with upper left cell F3.

Sales figur

es

         
             
 

Jan

Feb

Mar

     

North

2300

3200

4500

     

West

4300

3500

4200

     

East

5500

6500

6000

     
             
             
             

Range Names

Range names are extremely useful for making your formulas more understandable. After all, which formula makes more sense: =B20-B21 or =Revenue-Cost? Efficient use of range names takes some experience, but here are a few useful tips.

To create a range name:

Select a range that you want to name. Then type the desired range name in the upper left “name box” on the screen. (This box is just above the column A heading. It usually shows the cell address, such as E13, where the cursor is.)

You can also go through the Insert?Name?Define menu item, but typing the range name in the name box is quicker and more intuitive. By the way, range names are not case sensitive, so that Revenue, revenue, and REVENUE can be used interchangeably.

Try it! Name the rectangular range containing the numbers Data.

 
             
 

71

31

9

69

5

 
 

15

74

46

84

27

 
 

14

49

25

38

83

 
 

40

43

20

75

83

 
 

28

72

30

92

75

 
 

41

56

90

89

73

 
 

28

81

43

81

61

 
             
             

To delete a range name:

Use the Insert?Name?Define menu item. This shows a list of all range names in your workbook. Click on the one you want to delete, and then click on the delete button.

Suppose a range has name Costs and you want to rename it UnitCosts. If you highlight the range, the name box will show Costs. If you then overwrite this with UnitCosts in the name box, the range will have two names, Costs and UnitCosts. There is nothing inherently wrong with this, but if you want only a single name, UnitCosts, you will have to delete the Costs name, as described here.

Try it! The numerical range is currently named Data. Delete this range name and then rename the range Database.

 
             
 

15

86

50

41

21

 
 

63

18

10

1

9

 
 

14

52

16

18

65

 
 

89

88

28

72

7

 
 

15

28

57

92

2

 
 

29

90

86

100

83

 
 

10

82

100

65

4

 
             
             

Suppose you have the labels Revenue, Cost, and Profit in cells A20, A21, and A22, and you would like the cells B20, B21, and B22 (which will contain the values of revenue, cost, and profit) to have these range names. Here’s how to do it quickly.

To create range names from adjacent labels:

Select the range consisting of the labels and the cells to be named (A20:B22). Then use the Insert?Name?Create menu item, make sure the appropriate option (in this case, Left Column) is checked, and click on OK.

Excel tries (usually successfully) to guess where the labels are that you want to use as range names. If it guesses incorrectly, you can always override its guess.

Try it! Name the ranges A3:A8, B3:B8, and so on according to the labels in row 2.

 
             

Month

UnitsSold

UnitPrice

Revenue

     

Jan

100

$1.25

$125.00

     

Feb

150

$1.25

$187.50

     

Mar

200

$1.40

$280.00

     

Apr

230

$1.40

$322.00

     

May

200

$1.50

$300.00

     

Jun

300

$1.50

$450.00

     
             
             

Sometimes you have entered a formula using cell addresses, such as =B20-B21. Later, you name B20 as Revenue and B21 as Cost. The formula does not change to =Revenue-Cost automatically. However, you can make it change (and hence become more readable).

To apply range names to an existing formula:

Select the cell (or range of cells) with the formula(s). Then use the Insert?Name?Apply menu item, highlight any relevant range names for the formula(s) involved, and click on OK.

Try it! Apply the names of the cells B2 and B3 to the formulas in row 7.

 
             

Fixed cost

$50

         

Variable cost

$2

         
             

Month



Jan

Feb

Mar

Apr

   

Units produced

224

194

228

258

   

Total cost

$498

$438

$506

$566

   
             
             
             

To see a list of all range names and check which ranges they apply to:

Click on the down arrow at the right of the name box, and click on any of the range names you see. That range will then be selected automatically.

Try it! There are five named ranges below. Locate them.

 
                 
 

73

   

4

 

28

   
 

92

   

29

 

10

   
 

31

   

38

 

35

   
 

60

   

2

 

40

   
 

49

   

45

 

5

   
 

22

   

12

 

44

   
 

39

   

6

 

21

   
 

88

             
 

98

 

Junk

 

Junk

 

Junk

Junk

Sometimes it is straightforward to use range names in formulas. For example, if B20 is named Revenue and B21 is named Cost, then entering the formula =Revenue-Cost in, say, cell B22 is a natural thing to do. But consider this situation. The range B3:B14 contains revenues for each of 12 months, and its range name is Revenue. Similarly, C3:C14 contains costs, and its range name is Cost. For each month you want that month’s revenue minus cost in the appropriate cell in column D. You will get it correct if you select the range D3:D14, type the formula =RevenueCost, and press Ctrl-Enter. If you click on any cell in this range, you’ll see the formula =Revenue-Cost.

This is pretty amazing. How does Excel know that the formula in D3, for example, is really =B3C3? Let’s just say that it’s smart enough to figure this out. If it confuses you, however, you can always enter =B3-C3 and copy it down. Then you’re safe, but you’ve lost the advantage of range names!

Try it! Enter the formula for all of D3:D14 using range names. (If you like, calculate profits again in column E in the usual way, without range names.)

 
             
 

Revenue

Cost

Profit

     
 

$1,600

$1,400

       
 

$2,000

$1,800

       
 

$2,100

$1,800

       
 

$2,900

$2,800

       
 

$500

$400

       
 

$1,700

$1,500

       
 

$2,000

$1,900

       
 

$2,500

$2,300

       

To paste a list of all range names on a sheet:

To document your spreadsheet, it is often useful to create a list of all of your range names and their corresponding cell addresses. This is easy with the Insert?Name?Paste menu item.

To paste a list of all range names and corresponding addresses, select a cell with plenty of blank space below it, select the Insert?Name?Paste menu item, and click on the Paste List button.

Try it! Paste a list of all range names, starting in cell D2.

Revenue

$34,000

 

Range names used:

   

Cost

$22,000

         

Profit

$12,000

         
             
             
             
             
             
             

Basic Excel Functions

There are many useful functions in Excel. You should become familiar with the ones most useful to you. For example, financial analysts should learn the financial functions. But here are a few that everyone should know. (By the way, I capitalize the names of these functions, just for emphasis. However, they are not case sensitive. You can enter SUM or sum, for example, with the same result.)

SUM Function

The SUM function is probably the most used Excel function of all. It sums all values in one or more ranges.

To use the SUM function:

Enter the formula =SUM(range), where range is any range. This sums the numerical values in the range.

Actually, it is possible to include more than one range in a SUM formula, as long as they are separated by commas. (This can also be done with the COUNT, COUNTA, AVERAGE, MAX, and MIN functions discussed below.) For example, =SUM(B5,C10:D12,Revenues) is allowable (where Revenues is a name for some range). The result is the sum of the numerical values in all of these ranges combined. Note that if any cell in any of these ranges contains a label rather than a number, it is ignored in the sum.

Try it! Use the SUM function in cell B10 to calculate the total of all costs.

 

Table of c

osts for units

produced in

one month

(along side)

   

for use in

another month

 (along top)

       
             
 

Feb

Mar

Apr

May

   

Jan

$4,300

$3,100

$3,400

$5,900

   

Feb

 

$5,500

$6,400

$6,500

   

Mar

   

$6,800

$6,400

   

Apr

     

$5,900

   
             

Total cost

           

COUNT, COUNTA Functions

The COUNT function counts all of the cells in a range with numeric values. The COUNTA functions counts all nonblank cells in a range.

To use the COUNT function:

Enter the formula =COUNT(range), where range is any range. This returns the number of numeric values in the range.

To use the COUNTA function:

Enter the formula =COUNTA(range), where range is any range. This returns the number of nonblank cells in the range.

For example, if cells A1, A2, and A3 contain Month, 1, and 2, respectively, then =COUNT(A1:A3) returns 2, whereas =COUNTA(A1:A3) returns 3.

Try it! Use the COUNT and COUNTA functions to fill in cells E1 and E2. Note that there are students below the visible portion of the spreadsheet.

 

Student ID

Exam score

 

Number enrolled

 

3416

62

 

Number who took exam

 

6125

73

     

1535

74

     

2323

Absent

     

577

77

     

9044

57

     

8403

67

     

5892

90

     

4242

77

     

AVERAGE Function

The AVERAGE function averages all of the numeric cells in a range.

To use the AVERAGE function:

Enter the formula =AVERAGE(range) where range is any range. This produces the average of the numeric values in the range.

Note that the AVERAGE function ignores labels and blank cells in the average. So, for example, if the range C3:C50 includes scores for students on a test, but cells C6 and C32 are blank because these students haven’t yet taken the test, then =AVERAGE(C3:C50) averages only the scores for the students who took the test. (It doesn’t automatically average in zeros for the two who didn’t take the test.)

Try it! Use the AVERAGE function to calculate the averages in cells B1 and B2. (For B2, you’ll have to replicate the exam scores in column C and make some changes.)

 

Average exam score (for students who took the exam)

       

Average exam score (if absent students get zeros)

       
         

Student ID

Exam score

     

1533

68

     

8031

74

     

9859

80

     

9106

63

     

3535

72

     

8192

Absent

     

MAX, MIN Functions

The MAX function returns the largest numeric value in a range. Similarly, the MIN function returns the smallest numeric value in a range.

To use MAX and MIN functions:

Enter the formula =MAX(range) or =MIN(range) where range is any range. These produce the obvious results: the maximum (or minimum) value in the range.

Try it! Use the MAX and MIN functions to fill in the range B8:C9. For example, you want the values $2300 and $3600 in cells B8 and C9.

 
             

Sales rep

Allison

Baker

Jones

Miller

Smith

Taylor

Jan sales

$3,700

$2,400

$2,300

$3,000

$3,800

$3,700

Feb sales

$2,600

$2,200

$2,400

$2,800

$3,600

$2,300

             
             
 

Min sales

Max sales

       

Jan

           

Feb

           
             

SUMPRODUCT Function

There are many times when you want to sum products of values in two (or possibly more than two) similar-sized ranges. Fortunately, there is an Excel function that sums products quickly.

To use the SUMPRODUCT function

Enter the formula =SUMPRODUCT(range1,range2), where range1 and range2 are exactly the same size. For example, they might be two column ranges with 10 cells each, or they might be two ranges with 4 rows and 10 columns each. The formula sums the products of the values from the two ranges.

There can actually be more than two ranges in the SUMPRODUCT formula, separated by commas, so long as all of them have exactly the same size. This is not as common as having only two ranges, but it is sometimes useful

Try it! Sum the products of the two ranges in the following spreadsheet to find the total shipping cost. Enter the result in cell G1. (Scroll to the right for the answer.) By the way, if you are tempted to write the formula without the SUMPRODUCT function as the sum of 9 products, as many of my students continue to do, imagine how long your formula would be if there were 10 plants and 50 cities!

Unit shipping costs

City1

City2

City3

 

Total cost

 

Plant1

1.25

1.35

1.55

     

Plant2

1.15

1.45

1.25

     

Plant3

1.35

1.45

1.15

     
             

Units shipped

City1

City2

City3

     

Plant1

155

180

0

     

Plant2

250

130

185

     

Plant3

0

210

140

     

IF Function

IF functions are very useful, and they vary from simple to complex. I’ll provide a few examples.

To enter a basic IF function:

Enter the formula =IF(condition,expression1,expression2), where condition is any condition that is either true or false, expression1 is the value of the formula if the condition is true, and expression2 is the value of the formula if the condition is false.

A simple example is =IF(A1<5,10,“NA”). Note that if either of the expressions is a label (as opposed to a numeric value), it should be enclosed in double quotes.

Try it! Enter appropriate IF formulas in columns C and D. (Scroll to the right to see the correct answer.)

 

For eac

h product, if the

 end inventory is less than

or equal to 50 units,

 

enough

units are ordere

d to bring stock back up to

 200; otherwise, no

 

units of t

hat product ar

e ordered

   
         

Product

End inventory

Order placed (yes or no)?

# of units ordered

 

1

100

     

2

40

     

3

20

     

4

70

     
         

Sometimes IF functions are nested. For example, there might be three possibilities, depending on whether the value in cell A1 is negative, zero, or positive. A nested IF formula can then be used as follows.

To use nested IF functions:

Enter the formula =IF(condition1,expression1,IF(condition2,expression2,expression3)). If condition1 is true, the relevant value is expression1. Otherwise, check condition2. If it is true, the relevant value is expression2. Otherwise, the relevant value is expression3.

An example is =IF(A1<0,10,IF(A1=0,20,30)). Suppose this formula is entered in cell B2. Then if A1 contains a negative number, B2 contains 10. Otherwise, if A1 contains 0, B2 contains 20. Otherwise (meaning that A1 must contain a positive value), B2 contains 30.

Try it! Use a nested IF function to fill in the grades in column C. (Scroll to the right to see the correct answer.)

 

Each stud

ent gets an

A (if score i

s 90 or abo

ve), S for s

atisfactory (

if score

if 60 or ab

ove but less

 than 90) or

 U for unsat

isfactory if

score is bel

ow 60

             

Student

Score

Grade

       

1

70

         

2

95

         

3

55

         

4

80

         

5

60

         

6

90

         

Sometimes more complex conditions (AND/OR conditions) are useful in IF functions. These are not difficult once you know the syntax. To use an AND condition in an IF function:

Enter the formula =IF(AND(condition1,condition2),expression1,expression2). This results in expression1 if both condition1 and condition2 are true. Otherwise, it results in expression2.

Note the syntax. The keyword AND is followed by the conditions, separated by a comma and enclosed within parentheses. Also, note that more than two conditions could be included in the AND, all separated by commas.

Try it! Use an IF function with an AND condition to fill in the bordered range. (Scroll to the right to see the correct answer. Note the double quotes for labels.)

 

Investor sell

s stock only if

its price has gone

 up three c

onsecutive

days

(including t

he current day)

       
           

Day

Price change

Sell (yes or no)?

     

1

Up

       

2

Down

       

3

Up

       

4

Up

       

5

Up

       

6

Down

       

To use an OR condition in an IF function:

Enter the formula =IF(OR(condition1,condition2),expression1,expression2). This results in expression1 if either condition1 or condition2 is true (or if both are true). Otherwise, it results in expression2.

Again, more than two conditions could be included in the OR.

Try it! Use an IF function with an OR condition to fill in the bonuses in column F. (Scroll to the right to see the correct answer.)

 

Any stude

nt who scor

es at least

95 on any

of the exa

ms gets a b

onus

which is 1

% of their to

tal score.

       
             

Student

Exam 1

Exam 2

Exam 3

Exam 4

Bonus

 

1

87

83

83

80

   

2

77

72

74

97

   

3

80

95

79

75

   

4

82

87

96

88

   

5

78

94

81

79

   

6

75

83

80

72

   

VLOOKUP, HLOOKUP Functions

Lookup tables are useful when you want to compare a particular value to a set of values, and depending on where your value falls, assign a given “answer.” For example, you might have a tax table that shows, for any gross adjusted income, what the corresponding tax is. There are two versions of lookup tables, vertical (VLOOKUP) and horizontal (HLOOKUP). Since they are virtually identical except that vertical goes down whereas horizontal goes across, I’ll only discuss the VLOOKUP function.

The VLOOKUP function takes three arguments: (1) the value to be compared, (2) a lookup table, with the values to be compared against always in the leftmost column, and (3) the column number of the lookup table where you find the “answer.” (There is actually an optional fourth argument, but I won’t discuss it here. You can learn about it in Excel’s online help.) Since the VLOOKUP function is often copied down a column, it is usually necessary to make the second argument an absolute reference, and this is accomplished most easily by giving the lookup table a range name such as LookupTable. (Range names are always treated as absolute references.)

The only requirement of a lookup table is that the values in the first column (the comparison column) must be sorted in ascending order. Let’s say you want to assign letter grades to students based on a straight scale: below 60, an F: at least 60 but below 70, a D; at least 70 but below 80, a C; at least 80 but below 90, a B; and 90 or above, an A. The spreadsheet sample below shows how you would set this up. The comparison column in the lookup table starts at 0 (the lowest grade possible), then records the cutoff scores 60 through 90. The lookup table in the range E2:F6 is range-named LookupTable.

The formula in cell C2 is =VLOOKUP(B2,LookupTable,2), and this is copied down column C. This formula compares the value in B2 (67) to the values in column E and chooses the largest value less than or equal to it. This is 60. Then since the last argument in the VLOOKUP function is 2, the score reported in C2 comes from the second column of the lookup table next to 60, namely, D.

 

Student

Score

Grade

 

Lookup ta

ble

   

1

67

D

 

0

 

F

 

2

72

C

 

60

 

D

 

3

77

C

 

70

 

C

 

4

70

C

 

80

 

B

 

5

66

D

 

90

 

A

 

6

81

B

         

7

93

A

         

8

59

F

         

9

90

A

         

To use a VLOOKUP function:

Create a lookup table with at least two columns, where the values in the first column are in ascending order, and (for best results) give the table range a range name. Then enter the formula =VLOOKUP(value,lookup table,column #), as described above.

Try it! Enter a lookup table in columns E and F, and VLOOKUP functions in column C. Assume there is a quantity discount pricing scheme: for orders less than 300 units, the unit price is $3; for orders of at least 300 units but less than 400, the unit price is $2.50; for orders of 400 units or more, the unit price is $2. (Scroll to the right to see the correct answer.)

 

Order #

Units sold

Total cost

       

1

373

         

2

475

         

3

459

         

4

441

         

5

238

         

6

349

         

7

344

         

8

203

         
             

Paste Function (fx) Button

If you haven’t used this button, located just to the left of the formula bar, you should give it a try. I like to call it the “function wizard.” It not only lists all of the functions available in Excel (by category), but it also leads you through the use of them. As an example, suppose you know there is an Excel function that calculates payments on a loan, but you’re not sure what its name is or how to use it. You could proceed as follows.

To use the function wizard:

Select a blank cell where you want the function to go. Press the fx button and click on the category that seems most appropriate (Financial in this case). Scan through the list for a likely candidate and select it (try PMT). At this point you can get help, or you can press the Next button and enter the appropriate arguments for the function (interest rate, term, and principal, the latter expressed as a negative number).

Try it! Use the function wizard to help you determine the function in cell B6. Use the range names in cells B3 through B5 for improved readability. (Scroll to the right to see the correct formula.)

 

Payments for Mr. Jones, who just bought a new car

 
       

Amount financed

$15,000

   

Annual interest rate

8.90%

   

Term (number of months financed)

36

   

Monthly payment

     
       
       
       
       

Data Tables

Data tables, also called what-if tables, allow you to see very quickly how one or more outputs change as one or two key inputs change. There are two types of data tables: one-way tables and two-way tables. A one-way table has one input and any number of outputs. A two-way table has two inputs but only one output. I’ll demonstrate both types.

To illustrate, suppose Mr. Jones buys a new car for $20,000, makes a $5,000 down payment, and finances the remaining amount over the next 36 months at an 8.5% annual interest rate. There are at least two outputs that might be of interest: the monthly payment and the total interest paid through the duration of the loan. These are affected by at least two inputs: the amount of the down payment and the annual interest rate.

Let’s first look at a simple one-way data table, which illustrates how a single output, monthly payment, varies as the annual interest rate varies. This is shown in the following spreadsheet.

 

Price of car

$20,000

 

Data table

   

Down payment

$5,000

 

Interest rate

Monthly payment

 

Amount financed

$15,000

   

$473.51

 

Annual interest rate

8.50%

 

8.00%

$470.05

 

Number of payments

36

 

8.25%

$471.78

 
     

8.50%

$473.51

 

Monthly payment

$473.51

 

8.75%

$475.25

 

Total interest paid

$2,046.47

 

9.00%

$477.00

 
           
           

To create the above table (which I already did):

Enter a link for the output in cell E3. Since the monthly payment was calculated with the PMT function in cell B7, simply enter =B7 in cell E3. Then, starting in cell D4, enter any sequence of interest rates. Select the entire table—the range D3:E8. Finally, use the Data?Table menu item and enter B4 as the column input cell. There is no row input cell, so leave it blank.

It is important to understand what happens when you do this. Excel takes each interest rate in column D, substitutes it into the column input cell you designated (cell B4), recalculates the formula in cell E3 (the one I colored gray for emphasis) with this new interest rate, and records the answer in the data table. You use a column input cell because the possible inputs (interest rates) are listed in a column.

It is also possible to capture multiple outputs in a one-way data table. An example appears below, where the single input is still the interest rate, but there are two outputs: monthly payment and total interest paid. This table is formed exactly as before except that the table range is now D3:F8.

 

Price of car

$20,000

 

Data table

   

Down payment

$5,000

 

Interest

Monthly payment

Total interest

Amount financed

$15,000

   

$473.51

$2,046.47

Annual interest rate

8.50%

 

8.00%

$470.05

$1,921.64

Number of payments

36

 

8.25%

$471.78

$1,983.98

     

8.50%

$473.51

$2,046.47

Monthly payment

$473.51

 

8.75%

$475.25

$2,109.09

Total interest paid

$2,046.47

 

9.00%

$477.00

$2,171.86

           
           

Try it! Create a one-way data table that shows the monthly payments and the total interest paid for each term (value in cell B5) from 12 to 48 in increments of 12. (Scroll to the right for the correct answer.)

 

Price of car

$20,000

       

Down payment

$5,000

       

Amount financed

$15,000

       

Annual interest rate

8.50%

       

Number of payments

36

       
           

Monthly payment

$473.51

       

Total interest paid

$2,046.47

       
           
           

Two-way tables allow you to vary two inputs, one along a row and one along a column, and capture a single output in the body of the table. The following spreadsheet illustrates this, where the annual interest rate and the amount of the down payment both vary, and the single output is the monthly payment.

 

Price of car

$20,000

 

Data table

of monthly

payment

 

Down payment

$5,000

 

$473.51

$4,000

$5,000

$6,000

Amount financed

$15,000

 

8.00%

$501.38

$470.05

$438.71

Annual interest rate

8.50%

 

8.25%

$503.23

$471.78

$440.33

Number of payments

36

 

8.50%

$505.08

$473.51

$441.95

     

8.75%

$506.94

$475.25

$443.57

Monthly payment

$473.51

 

9.00%

$508.80

$477.00

$445.20

Total interest paid

$2,046.47

         
             
             

To create the above table (which I already did):

Enter the formula =B7 for the single output in the upper left corner, cell D2, of the data table. (Again, I colored this cell gray for emphasis.) Enter any sequence of down payments to the right of this and any sequence of interest rates below this. Finally, select the entire data table range, D2:G7, use the Data?Table menu item, enter B2 as the row input cell, and enter B4 as the column input cell.

Note that B2 is the row input cell because various down payments are entered in a row (E2:G2). Similarly, B4 is the column input cell because interest rates are entered in a column. Excel substitutes each down payment into cell B2, each interest rate into cell B4, calculates the formula in cell D2, and records the answer (monthly payment) in the body of the table.

Try it! Create a two-way data table that shows the total interest paid for each term from 12 to 48 in increments of 12, and each down payment from $3000 to $5000 in increments of $1000. Put down payments along the side, terms along the top. (Scroll to the right for the correct answer.)

 

Price of car

$20,000

       

Down payment

$5,000

       

Amount financed

$15,000

       

Annual interest rate

8.50%

       

Number of payments

36

       
           

Monthly payment

$473.51

       

Total interest paid

$2,046.47

       
           
           

Working with Text

Most people use Excel functions to calculate numbers. However, Excel also provides several very useful functions for manipulating text. These can be real time savers. This section illustrates some of the most common ways to manipulate text in Excel.

Parsing Text with Text Functions

Suppose, for example, that someone has given you a spreadsheet such as the one below. Each cell in column A has a person’s name: last name, then a comma and a space, and then first name. Your job is to “parse” these names as indicated for the name in cells C1 and D1. That is, column C should have all of the first names and column D should have all of the last names.

Unfortunately, suppose it turns out that there are 5000 names in column A. What do you do? If you just start typing, you’ll be at for a long time.

Jones, Bob

Bob

Jones

       

Davis, Stephen

           

Thompson, Andy

           

Wilson, John

           

Fredericks, Kathy

           

Williams, Karen

           

Smith, Tom

           

Jennings, Peter

           

Benson, Ted

           

Fortunately, there is a much better way. Logically, we note that every name has a comma and a space. The first name is what comes after the comma and space, and the last name is what comes before it. For the name Jones, Bob, there are 10 characters (including the comma and space, and the comma and space are characters 6 and 7. So the first name is the rightmost 3 characters and the last name is the leftmost 5 characters.

FIND, LEN, RIGHT, LEFT, and MID Functions

To implement this idea, we use Excel’s FIND, LEN, RIGHT, and LEFT functions.

To use the FIND function:

The FIND function has the syntax =FIND(subtext,text,n), where text is the original text and subtext is a piece of text to be found in text, and n is an optional integer argument. This function returns the position of the first occurrence of subtext, if any. If there are no occurrences, it returns an error. If the argument n is missing, it starts the search at character 1; otherwise, it starts the search at character n. Here are a few examples:

•    The formula =FIND(“, “,“Jones, Bob”) returns 6, since the comma is the sixth character in Jones, Bob.

•    The formula =FIND(“nes”,“Jones, Bob”) returns 3, since the subtext “nes” begins in the third character of Jones, Bob.

•    The formula =FIND(“o”,“Jones, Bob”) returns 2, since the first occurrence of the letter “o” occurs in the second character of Jones, Bob. However, the formula =FIND(“o”, “Jones,Bob”,3) returns 9, since the first occurrence of “o” starting from character 3 is character 9.

•    The formula =FIND(“t”,“Jones, Bob”) returns an error, since the letter “t” isn’t found in Jones, Bob.

To use the LEN function:

Enter the formula =LEN(text). This returns the number of characters in text.

To use the RIGHT function:

Enter the formula =RIGHT(text, n), where n is an integer. This returns the rightmost n characters in text. (If n is greater than LEN(text), it return the entire text.) To use the LEFT function:

Enter the formula =LEFT(text, n), where n is an integer. This returns the leftmost n characters in text. (If n is greater than LEN(text), it return the entire text.)

We now solve the name-parsing problem in a series of steps, as indicated below. In cell B1, we use LEN to get the length of the text in cell A1. In cell C1, we use FIND to find the position of the comma. In cell D1, we add 1 to find the position of the space after the comma. Then we find the first name with the RIGHT function, using the rightmost (10-7) characters. Similarly, we find the last name with the LEFT function, using the leftmost (6-1) characters. The beauty of this method is that we have to do it only once, in row 1. Then we can copy all of the formulas down for the rest of the names, even if there are 5000 of them! (Try it below. Copy the formulas down.)

Jones, Bob

10

6

7

Bob

Jones

 

Davis, Stephen

           

Thompson, Andy

           

Wilson, John

           

Fredericks, Kathy

           

Williams, Karen

           

Smith, Tom

           

Jennings, Peter

           

Benson, Ted

           

There is one other handy text function that often comes in useful, the MID function.

To use the MID function:

Enter the formula =MID(text,s,n), where s is an integer and n is an optional integer. If n is missing, this returns all of text from character s on. (s stands for start.) Otherwise, it returns n characters of text, starting with character s.

Here are some examples:

•    The function =MID(“Freddie”,5) returns “die”.

•    The function =MID(“Freddie”,5,2) returns “di”.

•    The function =MID(“Jones, Bob”,FIND(“,”,“Jones, Bob”)+2) returns “Bob”. (See why?)

Between these five functions—FIND, LEN, RIGHT, LEFT, and MID—you can do some powerful text manipulation in Excel, and this can often save hours of tedious typing.

Try it! This is a bit more difficult than the name-parsing exercise above. Now each name is a first name, then a middle initial and a period, and then a last name. The goal is to have three columns with the first name, the middle initial (no period), and the last name. (Scroll to the right for a possible solution. This solution finds each piece of the name in a single formula. You might prefer to break it up into several formulas.)

Bob E. Jones

           

Stephen C. Davis

           

Andy T. Thompson

           

John F. Wilson

           

Kathy C. Fredericks

           

Karen D. Williams

           

Tom T. Smith

           

Peter F. Jennings

           

Ted R. Benson

           

Concatenating Text

The opposite of parsing text is concatenating text. To parse text, we start with a long piece of text and divide it up into pieces. To concatenate, we start with two or more pieces of text and “string them together.” For example, we might parse “Bob Jones” into “Bob” and “Jones”. In the other direction, we might concatenate “Bob” and “Jones” into “Bob Jones”. The key to concatenating in Excel is the ampersand symbol, &.

To concatenate the text in cells A1 and B1, for example, enter the formula =A1&B1 in cell C1.

Literal text can also be included, such as =A1&“, ”&B1. In this case, if A1 contains “Jones” and B1 contains “Bob”, then C1 will contain “Jones, Bob”. This concatenates the last name, a literal comma and space, and the first name.

Try it! Concatenate the first names, middle initials, and last names in columns A, B, and C so that full names of the form Jones, Bob E. appear in column D.

Bob

E

Jones

       

Stephen

C

Davis

       

Andy

T

Thompson

       

John

F

Wilson

       

Kathy

C

Fredericks

       

Karen

D

Williams

       

Tom

T

Smith

       

Peter

F

Jennings

       

Ted

R

Benson

       

Working with Dates

We tend to take dates and times for granted, but they appear in many, if not most, real-world business spreadsheets. They are actually quite complex to work with, and a complete treatment of dates and times could fill a long chapter of a book. I can’t hope to cover all of the intricacies of Excel-based dates and times in this tutorial, but I will illustrate some of the most useful methods for working with them.

How Dates Are Stored

The first thing to realize is that a date-time value that appears in a cell as something like

3/14/2004 4:30 PM is really stored as a number. Excel refers to this number as the serial value. The serial value corresponding to this particular date happens to be 38060.688. The value to the left of the decimal is the number of days since some “base” date (January 1, 1900), and the decimal part indicates the fraction of time through the day, starting right after midnight. In this example 4:30 PM is 68.8% of the way from right after midnight to the next midnight. If the decimal part is omitted, then it is assumed to be midnight. In this case, you usually format the value so that only the date, not the time, appears.

If you happen to know the numbering system for dates (that is, you somehow know that 38060 corresponds to 3/14/2004), you could enter the number 38060 in a cell and then format it to look like a date. Usually, however, you enter a date like 3/14/2004 in a cell. In fact, if you enter the date in one of several formats Excel recognizes (including 3/14/2004, March 14, 2004, 3-14-04, and a few others), Excel will know that it is a date, but underneath the hood, it will store the value as 38060.

The same goes for date-times, such as 3/14/2004 4:30 PM, or just times, such as 4:30 PM. If you enter either of these in a format that Excel recognizes as a date-time or just a time, Excel will recognize that these as date-times or times, but it will store them as numbers (68030.688 or 0.688).



By the way, if you enter a date-time in a format that Excel doesn’t recognize, you’re entirely out of luck. It will simply be stored as a label, with no inherent “date-time” meaning. And Excel can be fussy. For example, it doesn’t understand 3/14/2004 4:30PM, simply because there is no space between 4:30 and PM! Also, Excel is smart about dates. It will recognize that 9/31/1999 and 2/29/2003 are not dates—regardless of how they are formatted.

Try it! The following spreadsheet includes some date-times, dates (no times specified), and times (no dates specified), formatted in several allowable ways. Format these as numbers with 3 decimals to see the serial values. Then reformat them as date-times (in formats you can choose).

3/14/04 1:30 PM

           

12/31/1901

           

3:50

           

12:00 PM

           

29-Feb-96

           

9/24/46 14:45

           
             
             
             

How Excel Deals with the Y2K Problem

Do you remember the Y2K problem that worried everyone in late 1999? The problem was that a large number of dates, in all kinds of systems, listed 2-digit years, such as 85 instead of 1985. How would systems know whether 05 meant 1905 or 2005? Fortunately, the predicted disaster didn’t happen, but there is still a Y2K problem because of the ambiguity it can create. Excel handles it (at least for now) by interpreting a 2-digit year less than 30 as being in the 21st century, and all others as being in the 20th century. For example, it interprets 3/14/17 as March 14, 2017 and 5/20/72 as May 20, 1972. Of course, the easiest way to avoid the ambiguity altogether is to use 4-digit years whenever you enter dates.

Try it! In the spreadsheet above, enter a date such as 3/14/29 (the last two digits less than

30). Then enter another date such as 5/20/30 (the last two digits greater than or equal to 30). Watch how Excel transforms the year automatically. Do you see how this could be a problem if you really meant 3/14/29 to be the birthday of a person born in 1929?

NOW, TODAY Functions

Excel has two useful functions for entering the current date, or the current date and time, automatically, TODAY and NOW.

To use the TODAY function:

Enter the formula =TODAY() in any blank cell. (The blank parentheses are necessary.) It returns the current date. If you open this spreadsheet tomorrow, it will list tomorrow’s date, that is, it updates each day.

To use the NOW function:

Enter the formula =NOW() in any blank cell. (Again, the blank parentheses are necessary.) It returns the current date and time.

Try it! Enter the TODAY and NOW functions in column B of the following spreadsheet. Then format result of NOW as time only—no date. After you’ve worked a few other exercises below, come back to this spreadsheet and see whether the time has changed. (You might have to force a recalculation to see the change. You can do this easily by pressing the F9 key.)

Today's date

           

Current time

           
             
             
             
             
             
             
             

YEAR, MONTH, DAY, WEEKDAY Functions

If a cell contains a date, it is easy to strip off the year, month, day, or even weekday with the YEAR, MONTH, DAY, and WEEKDAY functions. In all of the following examples, datecell refers to a cell that contains a date.

To use the YEAR function:

Enter the formula =YEAR(datecell). This returns a 4-digit year.

To use the MONTH function:

Enter the formula =MONTH(datecell). This returns a month from 1 (January) to 12 (December).

To use the DAY function:

Enter the formula =DAY(datecell). This returns the day of the month, from 1 to the number of days in the month.

To use the WEEKDAY function:

Enter the formula =WEEKDAY(datecell). This returns a number from 1 to 7, where 1 refers to Sunday, 2 to Monday, and so on. If you want to get the name of the day, such as Thursday, use a VLOOKUP function, as indicated in the exercise below.

Try it! For each date in column A, return the year, month, month name, day, weekday, and weekday name in columns B–G. For the month and weekday names, use the lookup tables given. (Scroll to the right to see them.) Do you recognize these “infamous” dates? Try one more: your own birthdate.

Date

Year

Month

Month name

Day

Weekday

Weekday na

9/11/2001

           

1/28/1986

           

11/22/1963

           

8/6/1945

           

12/7/1941

           

4/14/1912

           
             
             

DATEDIF Function

Since dates are stored as numbers, it is possible to perform arithmetic on them. One particular arithmetic operation makes sense: subtraction. If you subtract one date from another, you find the number of days between them. You can do this by simple subtraction of cells, or you can get more control with the DATEDIF function. If you use simple subtraction, you automatically get the difference in days. For example, the formula =A1-A2, where A1 contains 11/25/2004 and A2 contains 11/20/2004, gives 5. The DATEDIF function provides more options. (Evidently, DATEDIF has been in Excel for years, but its documentation in online help has been sporadic. See the interesting article at .) To use the DATEDIF function:

Enter the formula =DATEDIF(earlierdate,laterdate,interval), where interval can be “y”, “m”, “d”, or a few other options not covered here. If interval is “y” (quotes required), this returns the number of years between the two dates. Similarly, if interval is “m” or “d”, it returns the number of months or number of days between the two dates.

Try it! Use simple subtraction of cells to find the number of days between the following two dates. Then use DATEDIF with the three options described above to get the number of days, months, and years between the two dates. (Note: You’ll have to reformat the answer in cell B6 as a number. Excel wants to format it as a date for some odd reason. Scroll to the right for the answers.)

Dates of last two physical exams

       
             

First exam

4/5/1999

         

Next exam

7/15/2003

         
             

Days (subtraction)

           

Days (DATEDIF)

           

Months (DATEDIF)

           

Years (DATEDIF)

           

DATE, DATEVALUE Functions

The last two date functions I’ll mention are DATE and DATEVALUE. The DATE function takes a date, such as 3/14/2004, and return the serial value, in this case 68030. I see no obvious uses for this function. (After all, you can see the serial value if you want by formatting the date cell as a number. Besides, you probably have little interest in the actual number anyway.) I’ve mentioned it simply because you might see it in online help and think it’s important.

The DATEVALUE function, on the other hand, can be a real life-saver. It takes a date stored as text and returns the corresponding serial value, which you could then format as a date. Why is this important? Suppose you have a lot of data stored in some type of legacy system in your business, and you are somehow able to “dump” it into Excel. The chances are that all dates will be imported as text. That is, a cell value will look something like 5/20/2001, but Excel won’t recognize it as a date. Without the DATEVALUE function, you would have retype all of the dates! However, DATEVALUE saves you mind-numbing work.

To use the DATEVALUE function:

Enter the formula =DATEVALUE(datetext), where datetext refers to a date stored as text. Then format the result as a date.

Try it! Create dates in column B corresponding to the text values in column A that happen to look like dates. (I typed an apostrophe in front of each value in column A. That’s why they are interpreted as text, not as dates.)

Dates imported from a legacy system

     
             

Nov 25, 1997

           

Nov 26, 1997

           

Nov 29, 1997

           

Dec 1, 1997

           

Dec 3, 1997

           
             
             

Statistical Functions

There are many statistical functions built into Excel. I’ve already discussed the simplest statistical function, the AVERAGE function. (Statisticians often call this the mean, or the sample mean, but it’s very simply the average of a set of numbers.) In this section I’ll discuss a few other statistical functions.

MEDIAN, MODE Functions

The median is the “middle” value in a set of numbers, in the sense that half are above it and half are below it. More precisely, when the values are sorted in increasing order, it is the middle value if there are an odd number of values, and it is the average of the two middle values if there are an even number of values. Fortunately, Excel takes care of the details with the MEDIAN function.

To use the MEDIAN function:

Enter the formula =MEDIAN(datarange), where datarange is any range that contains a set of values.

Note that if datarange contains labels or blank cells, these are ignored when calculating the median. This is true for the other statistical function listed below. (It is also true for the

AVERAGE function.)

Try it! Find the median of the numbers in column A (which extend well below row 10). Is it the same as the average? Why or why not? (Scroll to the right to see the answers.)

33

 

Median:

       

3

 

Average:

       

0

 

Mode:

       

1

           

4

           

14

           

5

           

41

           

3

           

The mode is the most likely value, the one that occurs most often. If no value occurs more than once or twice, then the mode isn’t very useful. However, if a clothing retailer records the size of each dress sold, then the mode is quite useful. It is the best-selling dress size. Excel’s MODE function calculates the mode.

To use the MODE function:

Enter the formula =MODE(datarange), where datarange is any range that contains a set of values.

Try it! Calculate the mode of the set of values in the above spreadsheet. How many times does this value occur? (Again, answers are to the right.)

PERCENTILE, QUARTILE Functions

We often like to rank the values in a data set in some way. For example, if you can the SAT exam to get into college, you essentially learn your ranking by a percentile. If you are at the 85th percentile, you know that 85% of all people scored lower than you, and only 15% scored higher. Excel has two useful functions for finding this type of information: PERCENTILE and QUARTILE.

The QUARTILE function is probably the easiest to understand. Imagine that you have 1000 scores. You sort them from low to high and then divide them into 4 sets of 250 scores each, where the first set contains the smallest scores, the second set contains the next smallest scores, and so on. The first, second, and third quartiles are the breakpoints between these sets. For example, 25% of the scores are below the first quartile, and 75% are above it. (The second quartile is the median.)

To use the QUARTILE function:

Enter the formula =QUARTILE(datarange,k), where k is 1, 2, or 3. For example, if you enter 3 for k, you get the third quartile.

Try it! Find all three quartiles for the following data set (which extends well below row 10). Enter the formulas for these quartiles, labeled Q1, Q2, and Q3, in column D. (Scroll to the right to see the answers.)

86.23

 

Quartiles

   

Percentiles

89.69

 

Q1

   

P01

 

76.12

 

Q2

   

P05

 

129.72

 

Q3

   

P10

 

82.41

       

P25

 

106.6

       

P50

 

80.99

       

P75

 

73.26

       

P90

 

112.7

       

P95

 

The PERCENTILE function takes any percentage (expressed as a decimal number) and returns the value such that the given percentage of all values is below this value. For example, we use the percentage 10% (0.10) and the PERCENTILE function returns 45, then we know that 10% of all values in the data set are below 45 and 90% are above it.

To use the PERCENTILE function:

Enter the formula =PERCENTILE(datarange,pct), where pct is any percentage expressed as a decimal, such as 0.10 for 10%.

Try it! Find the requested percentiles in the above spreadsheet, and place your formulas in column G. For example, P10 indicates the 10th percentile. Do you see the relationship between the quartiles and certain percentiles? (Again, answers to the right.)

RANK, LARGE, SMALL Functions

If you would simply like to rank a set of values from 1 to N, where N is the number of values,

Excel offers the RANK function. You can either rank them from highest to lowest or vice versa. Of course, an alternative is to sort the numbers. If for any reason you don’t want to sort, then you can use the RANK function.

To use the RANK function:

Enter the formula =RANK(value,datarange, order), where value is a single value in the datarange, and order is an optional argument. If order is missing (or 0), rank 1 corresponds to the largest value; if order is 1 (or any other nonzero value), rank 1 corresponds to the smallest value.

Typically, you start with a data set in a column. Then you use the RANK function to rank the first value and copy it down (with datarange absolute) to rank all of the others. If two or more values are tied, then they share a rank.

Try it! Rank the values in A1:A10 from largest to smallest in column B. Then rank them from smallest to largest in column C. How does RANK deal with the tied 55’s? (Scroll to the right for answers.)

55

           

66

           

76

           

34

           

55

           

68

           

75

           

44

           

38

           

The LARGE and SMALL functions are less well-known Excel functions, but they can be useful. Let’s say you have a data set with 250 values and you want the 10 largest values. Then you can find these with the LARGE function, using arguments 1 through 10. Similarly, you could use the SMALL function to find the 10 smallest values.

To use the LARGE function:

Enter the formula =LARGE(datarange,k), where k is any integer from 1 to the number of data values. This returns the kth largest value.

To use the SMALL function:

Enter the formula =SMALL(datarange,k), where k is any integer from 1 to the number of data values. This returns the kth smallest value.

Typically, you would enter a sequence of values of k in some column, enter the LARGE or SMALL formula for the first of them, and then copy down.

Try it! For the data set in column A, which extends well below row 10, find the 10 largest values and 10 smallest values in columns D and E. Use the values of k in column C. (Scroll to the right for the answers.)

679.02

 

1

       

1208.42

 

2

       

1635.72

 

3

       

729.63

 

4

       

1036.08

 

5

       

716.62

 

6

       

972.92

 

7

       

1175.68

 

8

       

1271.38

 

9

       

STDEV, VAR Functions

Excel has a number of “advanced” statistical functions, including those for measuring the amount of variability in a set of numbers. The most widely used measures of variability are variance and standard deviation, and Excel implements these with the VAR and STDEV functions. (These functions calculate the sample variance and standard deviation. There are similar functions, VARP and STDEVP, for calculating the population variance and standard deviation. For large data sets—over 100 values, say—the sample and population measures are practically the same.) The variance is essentially the average of the squared deviations from the average, and the standard deviation is the square root of the variance. Each measures variability, but standard deviation is typically easier to understand because it is expressed in the same units as the data— dollars, for example. Besides, many data sets have the property that about 68% of the data are within 1 standard deviation of the average, about 95% are within 2 standard deviations of the average, and virtually all of the data are within 3 standard deviations of the average.

To use the VAR function:

Enter the formula =VAR(datarange).

This is equivalent to (STDEV(datarange))^2, the square of the standard deviation To use the STDEV function:

Enter the formula =STDEV(datarange).

This is equivalent to =SQRT(VAR(datarange)), the square root of the variance.

Try it! Find the average, variance, and standard deviation of the data in column A. Then use COUNTIF to find the percentage of values that are within 1 standard deviation of the average. Is it about 68%? (Scroll to the right to see the answers.)

1034.44

 

Average

       

877.35

 

Variance

       

794.42

 

Standard deviation

       

828.45

           

765.9

           

1088.95

           

786.05

           

1523.02

           

920.48

           

Financial Functions

Excel has a wide assortment of financial functions that are put to good use by thousands of financial analysts every day. I’ll illustrate the most common of these. If you’re going to be a financial analyst, you should become familiar with the others!

PMT Function

The PMT function is usually used to find the monthly payment you have to make on a car or house when you take out a loan. The inputs are typically an annual interest rate, a term (number of months financed), and the amount borrowed (the principal). The PMT function finds the amount you have to pay each month of the term. Part of this payment is principal and part is interest. At the end of the term, you will have paid just enough to pay off the entire loan.

To use the PMT function:

Enter the formula =PMT(interestrate,term,principal). For technical reasons, if you want the PMT to return a positive value, you should enter the principal as a negative number. The interest rate argument should be the monthly rate (assuming you’re paying monthly), which is the annual rate divided by 12.

Try it! Suppose you take out a $30,000 loan for a new car when the annual interest rate is 6.75% and the term of the loan is 36 months. Calculate your monthly payment in cell B4.

Then use a data table (the perfect place for one!) to see how your monthly payment varies for terms of 24, 36, 48, or 60 months. (Scroll to the right to see the answers.)

Principal

$30,000

 

Data table for payment versus term

Annual interest

6.75%

         

Term

36

         

Payment

           
             
             
             
             
             

NPV, XNPV Functions

Much of the theory of finance is about the time value of money. Basically, a dollar earned in the future is less valuable than a dollar earned today, because the dollar earned today could earn interest. To account for this, we “discount” future inflows or outflows to get their present values now. If we have a future stream of inflows and/or outflows, then the sum of all of their present values is called the net present value, usually abbreviated NPV. If this stream is incurred at regular time intervals—at the end of each year, say—then we can use Excel’s handy NPV function to calculate the NPV of the stream.

To use the NPV function:

Enter the formula =NPV(rate,cashstream). Here, rate is the discount rate, which is essentially the rate the company believes it can make on its money, and cashstream is a stream of cash inflows or outflows that occur at the ends of successive periods, starting at the end of period 1.

Note that if there is a cash inflow or outflow right away, at the beginning of period 1, it should be entered outside the NPV function. The reason is that it doesn’t need to be discounted.

Try it! Assume a company pays $100,000 at the beginning of year 1 to get into an investment. It then receives the cash inflows at the ends of years 1 through 5 shown. When is the NPV of this investment (inflows minus outflows) with the given discount rate? Does the NPV increase or decrease as the discount rate increases? Why? (Scroll down to see the answer.)

Discount rate

12%

         

Initial payment

$100,000

         
             

Cash inflows at ends of years

         

Year

1

2

3

4

5

 

Inflow

$20,000

$35,000

$50,000

$45,000

$35,000

 
             

NPV

           
             

If a company incurs cash inflows or outflows at irregular spacings of time, such as January 15, then May 30, then July 1, and so on, the NPV function cannot be used. You could go back to your finance book to see how to discount future payments directly, but there is an easier way, using the little-known XNPV function. This function is actually part of the Analysis ToolPak that ships with Excel. However, you might not have it loaded. To check, select the Tools?AddIns menu item. If the Analysis ToolPak item isn’t checked, check it. Then you can use the XNPV function.

To use the XNPV function:

Enter the formula =XNPV(discountrate,cashvalues,dates), where discountrate is the same as with NPV and cashvalues and dates are a stream of pairs of cash values and the dates when they are incurred.

Typically, the first cash value will be an outflow and the rest will be inflows. In this case, the initial outflow (investment) should be included in the XNPV function, and the NPV will be discounted back to the date of this initial payment. This payment should be entered as a negative number.

Try it! First make sure the Analysis ToolPak is loaded. Then find the net present value of the stream of cash inflows shown below, where the first is really a payment at the beginning of 2005. (Scroll down to see the answer.)

Discount rate

12%

         
             

Stream of cash flows

         

Date

1-Jan-05

25-May-05

15-Sep-05

15-Jan-06

30-Jun-06

 

Cash

($85,000)

$22,500

$31,000

$65,500

$55,000

 
             

NPV

           
             
             

IRR Function

Companies often have investment opportunities where they pay initially and then get returns in the future. When discussing NPV, I illustrated in the “Try it!” exercise that the NPV of such an investment decreases as the discount rate increases. In fact, for large enough discount rates, the NPV will typically become negative, meaning that the future returns are not enough to offset the initial cost. The discount rate at which NPV changes from positive to negative is called the internal rate of return, or IRR. Specifically, the IRR is the discount rate at which NPV equals 0. Companies are interested in IRR for the following reason. They typically have a “hurdle rate” that they use to discount potential investments. If the NPV of an investment is positive, discounted at the hurdle rate, it is worth pursuing. If it is negative, it is not worth pursuing. Stated equivalently, the investment is worth pursuing only if its IRR is greater than the company’s hurdle rate.

Fortunately, Excel has an IRR function that calculates an investment’s IRR—a tough calculation. As with the NPV function, we assume the investment is structured so that there is an initial cash payment at the beginning of year 1 and then regular cash returns at the ends of years 1, 2, and so on.

To use the IRR function:

Enter the formula =IRR(cashstream,rateguess), where cashstream is a stream of cash flows, where the first (the initial payment) should be negative, and rateguess is an initial guess for the IRR.

This seems strange. Why should you have to guess at the answer? It is because Excel calculates the IRR iteratively, starting with your guess. Your actual guess shouldn’t make any difference in the final answer except in unusual cases.

Try it! Find the IRR for the following investment, using an initial guess of 15%. What does this IRR say about the attractiveness of the investment? (Scroll down to see the answer.)

Cash flows (initial value is a payment)

     

($100,000)

$35,000

$45,000

$40,000

$25,000

$10,000

 
             

IRR

           
             
             
             
             
             

Lookup and Reference Functions

I have heard an Excel expert make the claim that the VLOOKUP function, discussed earlier, is the most useful Excel function of all. Whether or not you believe this claim, the VLOOKUP and HLOOKUP functions are just two of some very useful “reference” functions in Excel’s arsenal.

If you click on the fx button for online help on Excel functions, you will see a Lookup and Reference category of functions that includes VLOOKUP, HLOOKUP, and several others. I will illustrate a few of these others here. Although they are arguably not as useful as VLOOKUP, they can definitely come in handy in certain situations.

INDEX Function

The INDEX function is useful for finding the value in a particular cell of a range. You access this value by the “index” of the cell you want. Specifically, you specify a row index and a column index. For example, if the range has 10 rows and 20 columns, the index 4,8 indicates row 4 and column 8 of the range.

To use the INDEX function:

Enter the formula =INDEX(range,r_index,c_index), where r_index is an integer (for row) and c_index is an integer (for column).

For example, the formula =INDEX(D11:F20,4,2) refers to the value in cell E14, the cell in the fourth row and second column of the range.

If range is a single-column range, then the c_index argument can be omitted. In that case, =INDEX(range,r_index) returns the value in row r_index of the range. For example, the formula =INDEX(A11:A20,3) refers to the value in cell A13, the third cell in the range.

Try it! Find the unit shipping cost from Plant2 to City3 with a formula in cell B6. Then enter a formula in cell B10 that finds the unit shipping cost from the plant to the city specified in cells B8 and B9. This formula should respond appropriately to whatever plant and city indexes are entered in cells B8 and B9. (Scroll to the right for the answers.)

Unit shipping costs

City1

City2

City3

     

Plant1

1.25

1.35

1.55

     

Plant2

1.15

1.45

1.25

     

Plant3

1.35

1.45

1.15

     
             

Unit shipping from Plant2 to City3

           
             

Plant

1

         

City

2

         

MATCH Function

The MATCH function is handy for finding a cell in a range that matches a given value. It is often used in the following situation. Suppose you have decision variable such as order quantity that needs to chosen so as to maximize some profit. You enter some formulas that link order quantity to the profit. Then you create a data table that finds the profit for a number of possible order quantities. The MATCH function lets you locate the cell in the data table with the smallest profit.

To use the MATCH function:

Enter the formula =MATCH(value,range,0). This returns the index of the cell in range that matches value. For example, if the match occurs in the third cell of the range, this returns 3.

The last argument, 0, indicates that we want an exact match. If there is no exact match, the formula returns an error. The MATCH function can also look for an inexact match by using third argument TRUE. I’ll let you look this up in online help.

The following spreadsheet indicates how MATCH can be used in conjunction with INDEX. You can imagine that a profit model has led to the table shown, where each order quantity listed leads to the corresponding profit. For this small example, it is obvious that the largest expected profit is $5,640, which corresponds to an order quantity of 300. However, if inputs (not shown) that drive the profit model change, the best order quantity and the corresponding profit could change. We want formulas in cells B9 and B10 that show the best order quantity and best profit regardless of where they appear in the table.

Table of profit versus order quantity

       

Order quantity

Profit

         

200

$5,325

         

250

$5,430

         

300

$5,640

         

350

$5,565

         

400

$5,235

         
             

Best order quantity

300

         

The formula in cell B9 is =INDEX(A3:A7,MATCH(MAX(B3:B7),B3:B7,0)). The whole purpose of the MATCH function here is to provide the row index for the INDEX function. That is, we know the best order quantity is one of the values in the range A3:A7, and we need to know which one. So we find a match for the maximum value in B3:B7 to the values in B3:B7. In this case, the maximum is the third profit, so the formula is equivalent to =INDEX(A3:A7,3). Similarly, the formula in cell B10 is =INDEX(B3:B7,MATCH(MAX(B3:B7),B3:B7,0)). To see that these are dynamic, try changing the value in cell B6 from $5565 to $5765.

Try it! The table below shows the profit for each order quantity and each unit stockout cost (along the top). Enter formulas in the range B9:E9 to find the best order quantity for each unit stockout cost. (Scroll down to see the answer.)

Profit for various order quantities (column A) and unit stockout costs (row 3)

 
 

$2

$3

$4

$5

   

200

$5,235

$5,175

$5,025

$4,935

   

250

$5,465

$5,285

$5,190

$5,085

   

300

$5,355

$5,325

$5,265

$5,100

   

350

$5,215

$5,195

$5,130

$5,125

   

400

$5,145

$5,085

$5,015

$5,005

   
             

Best order quantities

           

OFFSET function

The OFFSET function allows you to reference a range (or single cell) relative to another cell. It is hard to appreciate unless you see some examples, so I will present two below.

To use the OFFSET function:

Enter the formula =OFFSET(cell,r_offset,c_offset,height,width). Here, r_offset and c_offset are integers that can be positive, negative, or zero, and height and width are optional positive integers. If either height and width are missing, they default to 1. This formula returns a reference to a range that has height rows and width columns. To find its upper left cell, start at cell, move r_offset rows down (if positive) or up (if negative), and move c_offset columns to the right (if positive) or the left (if negative).

For example the formula =OFFSET(A1,2,3,4,1) returns a reference to the range D3:D6. It is a range with 4 rows and 1 column, and its upper left cell, D3, is offset from cell A1 by going 2 rows down and 3 columns to the right. As another example, the formula =OFFSET(F4,0,-3) refers to a single cell (because the last two arguments are missing), and this single cell is 3 columns to the left of F4, namely, C4.

A nice example of the OFFSET function appears in the spreadsheet below. Our company sells to a retailer, and the retailer pays a certain number of months later, as indicated by the payment delay (in months) in cell B1. The sales occur as indicated in row 4, but the receipts from the retailer occur 2 months later, as indicated in row 5.

 

Without the OFFSET function, we could simply put links in the Receipts row that point to sales 2 months earlier. For example, the formula for receipts in January would be =C4. But what if the retailer decides to delay payments by 3 months instead of 2? Then we would need to fix the links in the Receipts row. However, a clever use of OFFSET avoids this updating of links. We use the formula =OFFSET(E4,0,-$B$1) in cell E5 for January, and then copy it across row 5 for the other months. This formula says to start in the January sales cell and go a certain number of cells to the left (because of the minus sign), where this number is specified in cell B1. To see how it works, try changing the value in cell B1 to 3 or 1. (What would go wrong if you changed this delay to 4 months? How would you fix it?)

Try it! Suppose that a manufacturing company buys raw materials from a supplier. If the cost in any month is $x, the company pays 40% of this cost 1 month from now and the other 60% 2 months from now. Use the OFFSET function to calculate the payments made in January through August, based on the costs through July. These calculated payments should change automatically if you change the inputs in cells B1:B2 and D1:D2. For example, make sure your formulas react correctly if you enter 2 and 3 in cells D1 and D2. (Scroll down to see the answer.)

Percent paid

40%

when:

1

month from now

 
 

60%

 

2

months from now

 
             

Month

Oct

Nov

Dec

Jan

Feb

 

Cost

$1,950

$2,900

$4,150

$2,500

$3,350

$2,8

Payment

           
             
             
             

Another great use of the OFFSET function is to create a dynamic range name, one that expands or contracts depending on the number of data values in a range. Consider the following spreadsheet, where monthly sales values are entered in column B, and the total of all sales values is calculated in cell E1. Every month, an extra sales value and its month label are appended to the list in columns A and B. We can make the formula in cell E1 automatically adjust to the appended values by using a dynamic range name.

Month

Sales

 

Total

$17,030

   

Jan-05

$2,450

         

Feb-05

$3,140

         

Mar-05

$3,250

         

Apr-05

$4,510

         

May-05

$3,680

         
             
             
             

To do this, I selected the Insert?Name?Define menu item. In the Names in workbook box at the top, I entered Sales. This is my range name. In the Refers To box at the bottom, I entered the formula =OFFSET(B1,1,0,COUNT(B:B),1). Then I clicked on OK. Finally, I entered the formula =SUM(Sales) in cell E1. Note that COUNT(B:B) refers to the count of all numeric cells in column B. So this OFFSET function refers to a range that starts 1 cell down from cell B1 and has as many rows as there are numeric values in column B. To see how it adjusts, enter a sales value for June in cell B7 and watch how the total changes automatically.

Note that COUNT(B:B) counts all of the numeric values in column B, so if there were some other numbers down below sales, they could mess up the logic in the OFFSET function. For example, suppose there were a numeric value in cell B100. Then, given the data above, COUNT(B:B) would return 6, so at that point, the Sales range name would refer to the range B2:B7, that is, 6 cells starting with B2. The moral is that if you want to use dynamic range names, it’s best not to include “junk” in the affected columns or rows.

Try it! The following spreadsheet has sales by month and by salesperson. We want to sum sales over all months and salespeople in cell B2. Create a dynamic range that changes when new months are added and when salesperson columns are added or deleted. Then use this range name to sum sales in cell B2. (Scroll across to see answer.)

Total sales

           
     

Smith

Jones

Wilson

Dona

   

Jan-05

$6,700

$7,400

$5,800

$9,

   

Feb-05

$5,800

$8,900

$5,500

$7,

   

Mar-05

$5,000

$7,900

$5,900

$8,

   

Apr-05

$6,700

$5,800

$6,000

$9,

   

May-05

$9,400

$7,800

$6,700

$8,

   

Jun-05

$6,200

$5,800

$9,400

$8,

   

Jul-05

$8,700

$5,300

$6,900

$7,

A great use for dynamic range names is with pivot tables. Suppose you want to base a pivot table on a data set that is likely to expand (or possibly contract) as time goes on. You can create a dynamic range name such as MyData for the data set. Then when you go through the pivot table wizard and step 2 asks for the data range, enter MyData. If your data set expands or contracts in the future, all you need to do is click on the Refresh pivot table button (!) to update the pivot table with the newest data. If you show this trick to your colleagues at work, you’ll be a hero!

Working with the Excel Interface

Many people believe they have to work with Excel exactly the way it appears after it is installed. This is definitely not the case. You can easily customize the Excel interface in ways that suit you best. For example, you are not stuck with the two toolbars (Standard and Formatting) that you typically see in Excel. There are quite a few others all ready for you to use, if you choose to. In addition, the typical buttons on these toolbars are not the only ones available. And if there are buttons on these toolbars that you never use, you can drag them off and replace them with buttons you prefer instead. You can even create your own toolbars and populate them with your own custom buttons. I will illustrate how to perform some of these tasks in this section.

Recall that the asterisks before the section titles indicate that you should do these tasks on your own PC, not on networked PCs that belong to your school or company. Networked PCs are typically set up so that you cannot change the “look and feel” of Excel, whereas you have complete control over Excel in your own PC.

*Recording Simple Macros Into

Macros are sets of instructions (programs) that automate various tasks in Excel. Microsoft has developed a programming language, Visual Basic for Applications, or VBA, that can be used to develop macros in Excel and other Microsoft Office applications. It takes some time to learn this language, but you don’t need to learn it to record simple macros and then use them. This can be very handy for automating tasks that you do frequently. In fact, once you’ve recorded a useful macro, you can even assign it to a button that you can place in a toolbar. Then every time you want to perform the task (run the macro), all you have to do is click on the button. This section will illustrate the procedure.

Here’s a neat example. Suppose there are many times you’d like to place a blue border around a range. Wouldn’t it be nice to simply select the range (or ranges), click on a button, and have the blue border(s) appear? The procedure, which only ever has to be done once on a given PC, is as follows:

1.    Select any range.

2.    Turn on the macro recorder (with the Tools?Record Macro?Record New Macro menu item).

3.    Give the macro a suggestive name, such as BlueBorder, in the Macro Name box, and then click on the Options button to obtain a dialog box.

4.    Under the Store In section, click on Personal Macro Workbook and then click on OK. This stores your macro in a file called , which is stored in your XLStart directory so that it always opens when you open Excel. (It is usually stored as a “hidden” file, so that you don’t actually see it. But it’s there, and all of the macros in it are available to you at any time.) Note: You probably will not be allowed to do this in your school's lab. But it should work fine on your own PC.

5.    The recorder is now running, so anything you do is being recorded–so be careful. Go through the procedure of putting a blue border around the range you selected. (To do this, use the Format?Cells menu item, click on the Borders tab, and make the obvious selections to get a blue outline border.)

6.    Once you’ve got the blue border, click on the black square “stop” button that’s floating somewhere on the screen. This turns off the recorder.

7.    To check whether the macro is working correctly, select any range and “run” the macro. To run it, use the Tools?Macro menu item, click on the macro name you just recorded, and click on the Run button. You should get a blue border around the selection. (Actually, try running it with more than one range selected. You should get a blue border around each selected range. This makes the macro even more useful!)

Try it! Record a macro called BlueBorder and then test it out. Note: In step 4 above, choose the This Workbook option instead of the Personal Macro Workbook option. It will work better for this demo.

 

Try it again! A common task is to copy a range of formulas onto itself, but to replace the formulas with values. (Remember the Paste Special/Values option?) Record a macro called Special that does this, using the formulas in column C when you do the recording. Then try out your macro with the formulas in column D. (Again, choose the This Workbook option instead of the Personal Macro Workbook option for this demo.)

 

Value 1

Value 2

Sum

Product

     

7

10

17

70

     

4

3

7

12

     

6

3

9

18

     

2

3

5

6

     

3

9

12

27

     

4

5

9

20

     

8

2

10

16

     

6

1

7

6

     
             

*Customizing Toolbars

Excel provides several toolbars. Two of these, the Standard and Formatting toolbars, appear by default when you open Excel. Each of the buttons on these toolbars has a macro assigned to it, so that when you click on the button, some useful task is carried out. You might not know, however, that there are several other toolbars you can make visible at any time. In addition, there are a number of preprogrammed buttons that you can add to any of the toolbars, and you can delete any of the “standard” buttons you never use. You can even form your own toolbars and customized buttons (that run your own macros), and it’s all quite easy. This section will explain how.

To see a list of toolbars and show or hide any of them:

Put the cursor over any toolbar and right click. You’ll see a list of toolbars. Click on any to place checks next to those you want to show or remove checks next to those you want to hide.

To add preprogrammed buttons to any of the built-in toolbars (or delete any buttons):

Put the cursor over any toolbar and right click. Choose the Customize option at the bottom and then click on the Commands tab in the resulting dialog box. You’ll see a list of categories and buttons. Click on any category and then click on any button. You’ll see a short description of what this button does at the bottom of the dialog box. If you’d like to have this button on a toolbar, simply drag it to the toolbar. Similarly, if there is any button on a toolbar that you never use, simply drag it off the toolbar to delete it.

To add your own button (with your own macro) to a toolbar:

Let’s say you’ve recorded the macro BlueBorder (as above) and you now want to attach it to a button that you’ll place on a toolbar. Put the cursor over any toolbar, right click, choose the Customize option, and click on the Commands tab. Scroll down the list of categories until you get to the Macros category, and click on it. You’ll see a generic "happy face" button that doesn't have any preprogrammed macro attached to it. This button for your use! Click on it and drag it up to a toolbar. Now right click on your new button (with the Customize dialog box still open) to see a menu. Click on Assign Macro, and then select BlueBorder from the list of macros shown. This assigns your macro to the button.

At this point you probably want a more suggestive picture (icon) on your new button. You have two options. The first is to right click on the button (with the Customize dialog box still open) and select the Edit Button Image menu item. This takes you to a “paint” program where you can paint the image you want (such as a blue rectangular border).

Alternatively, you can “borrow” an image and then modify it. To do this, right click on a button whose image you want to borrow and select the Copy Button Image menu item. Then right click on your new button and select the Paste Button Image menu item. Finally, right click again on your new button, select the Edit Button Image menu item, and modify the image as you like. (Note: If you’d like to mimic the image of a button that shows in the Customize dialog box but isn’t yet on a toolbar, you’ll need to drag this to a toolbar first. You can always drag it off after you’ve copied its image.) Finally, right click on the button and type Blue Outline Border next to the Name: menu item. This creates a "tool tip" for your button. From then on, when you put your cursor over the button, you'll see this tool tip.

To create a new toolbar (that will probably contain your customized buttons):

Put the cursor over any toolbar, right click, choose Customize, click on the Toolbars tab, and click on the New button. This allows you to create a new toolbar with a name you can choose. From that point your new toolbar is just like any of the ones that came with Excel. You can show it or hide it, and you can add buttons to it. In fact, it starts out empty, so you will have to add buttons to it to make it useful. If you mess up, or if you don't need your new toolbar any longer, just go to Customize and the Toolbars tab, select your toolbar, and click on Delete.

*Setting the Default Number of Sheets in a New Workbook

Excel’s default number of worksheets in a workbook is 3. Usually, you need only 1, and the extra blank sheets just take up wasted memory on your hard drive when you save the file. (Three is often more than you need, but it’s better than the previous default value, 16!) To change the default number of sheets in a new workbook:

Use Tools?Options, click on the General tab, and change the Sheets in New Workbook setting to a smaller number, probably 1.

*Showing All of the Menu Items

Does it bother you that the various Excel menus (File, Edit, etc.) show only some of the menu items? I personally like to see all of them. This is easy to fix, and you only have to do it once.

To show all menu items:

Select the Tools?Customize menu item. Under the Options tab, make sure the “Always show full menus” option is checked.



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