FAQ: Advanced Functions
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1 Question 1: What are formulas and functions? Answer 1: Formulas are a type of data that can be entered into a cell in Excel. Formulas begin with an equal sign and use mathematical operators to calculate a result based on input. The types of calculations that can be performed using formulas include financial, comparative, and logical computations. Users of Excel can calculate anything that can be done by hand or with a calculator through the use formulas. When properly written, cell reference formulas are powerful because they can be used to answer complex, process-type questions. For example, imagine if the attendance of a conference increased from 100 participants to 150. Based on data and formulas already entered into a spreadsheet, the user could change the one piece of data that refers to the number of attendees and see how it affects all other aspects of the conference through the calculations in the spreadsheet. Functions are formulas that have been prewritten for the user. The user must supply input to a function by supplying arguments. Functions allow a user to focus on the arguments, or inputs, and not how the calculations behind the function work. This does not mean that a user does not need to understand how the function and therefore the calculations work; it simply means that the user does not have to manually write the calculations in Excel. Question 2: Can data be entered directly into a formula or function? Answer 2: Numeric and text data can be entered directly into a formula or function, but this is not good practice. Any inputs which are called arguments to a formula or function should be entered into separate, labeled cells. The cell addresses should then be used within the function or formula. The purpose of this is so that arguments can be easily changed without having to work within the formula or function itself. This practice leads to flexibility in design and increases the reusability of a worksheet. A well-designed worksheet that contains formulas and functions will have an area for user input that is easily distinguished from other parts of the worksheet. This user input area is where any variable arguments should be placed for formulas and functions. For example, if a user is planning on buying a new car and decides to create a worksheet to determine payments based upon the price of the car, interest rates, and the term of the loan, he or she can use a PMT function to accomplish this. The three items listed here may change depending on the make and model of the vehicle, interest rates being offered, and how long the user chooses to pay back the loan. 1
2 Considering that they may change this information means that they are variable and therefore should be placed in an area where making the changes will be easy to accomplish. If the user has a user input area with the function in another area labeled "Payment," then he or she can easily change any of the variable data and see the results quickly. Question 3: What are the differences between relative and absolute cell references? Answer 3: A cell reference that changes when copied is referred to as a relative cell reference, whereas a cell reference that does not change when copied is an absolute cell reference. Relative cell references are used in formulas and functions, but the use of absolute references is often necessary. When an absolute cell reference is viewed, it will have a dollar sign ($) in front of the column letter and row number; for example, $A$1 is an absolute cell reference. In addition, there are also mixed cell references that may only have a dollar sign in front of the column or row heading rather than both. The dollar sign indicates that the reference directly following it is an absolute reference and therefore should not change. If, for example, the reference A$1 is copied and moved to column C, the A would change to C. However, the 1 indicating row 1 would not change, and the reference would be C$1. Question 4: Why use an absolute cell reference rather than a relative cell reference? Answer 4: Using absolute cell references in practice is optional. In other words, any time an absolute cell reference is used, the same results can be created in the formula or function with a relative cell reference. The reason a user would want to use absolute cell references is to save time when copying formulas that the user has already written and tested. For example, consider a situation in which everyone in a department will receive the same raise based upon a percentage of his or her current salary. If there are only a few people in the department, entering a formula that takes a percentage of a current salary and adding it to the current salary to figure the new salary would be simple. However, what if there are 120 people in the department? Writing the same formula over and over will waste a lot of time. Rather than do that, the spreadsheet creator can use a single absolute cell reference to the increase percentage and then copy the formula. Question 5: Besides relative, absolute, and mixed cell references, is there 2
3 any other way to refer to cells within a formula or function? Answer 5: Yes, a range name can be used as a reference within a formula or function. A range name is a word or mnemonic that can be applied to a cell or range of cells. It is good practice to use range names within formulas and functions because this aids in the readability of the formula or function. For example, if the total number of people attending a wedding is entered in cell C5, and the cost per person for the reception following the wedding is entered in C6, it would be very easy to create a formula in cell C7 to calculate the cost. The formula would look like this: "=C5*C6." If a user opens this worksheet and looks only at the formula, it would not make much sense out of the context of the labeled data above. Yes, it would be clear that the contents of C5 are being multiplied by the contents of C6, but the user would have no idea what it means. Using range names, the user could name cell C5 "NumberOfAttendees," and C6 "PerPersonReceptionCost." Then the formula would read as follows: "=NumberOfAttendees*PerPersonReceptionCost." When this formula is viewed, it is very clear what the result represents. Question 6: What is the fastest way to copy a formula to multiple cells in a single row or column? Answer 6: Using the Auto Fill handle is the fastest way to do this. When selecting the cell that contains the formula to copy, a black button will appear on the bottom-right corner of the cell. Clicking on this button and dragging the mouse will activate the Auto Fill function. Any relative references in the original formula will change, and absolute references will remain the same. The tag that shows up after using Auto Fill is the Auto Fill Options button. The options presented here allow the user to change how Auto Fill works. Copy Cells is the default selection and will copy the contents of the active cell as described before. The Fill Series option allows more flexibility in what is copied. It will recognize many series and fill them for the user. For example, if the user types "Jan" in A1 and "Feb" in B2, selects A1 and B2, activates Auto Fill, and then pulls the handle over to L1, the months of the year will be filled in automatically. This can also be used to fill series of numbers. The Fill Formatting Only option will change the formatting of the filled cells to match the original active cell. The Fill Without Formatting option will copy everything except the formatting of the original active cell. To create the incremental series, the user must select more than one cell before beginning the Auto Fill function. 3
4 For example, the use of Auto Fill would be helpful when creating a monthly budget worksheet. Once the user has entered the categories that will be included in the budget in column A, the user can then enter the months of the year in Row 1 using the technique described above. In the total row below all of the categories, the user need only write the formula once, in the Jan column, and then use Auto Fill to copy this formula to the rest of the months. As seen here, Auto Fill can save a lot of time when creating a budget. Question 7: Should the Insert Function button be used even if the user can input the arguments directly into a cell? Answer 7: No, if the user feels comfortable typing the arguments for a function directly into a cell, then he or she should do so; this could be a time saving option for some users. Programmers often enter functions manually, but most other people benefit from the use of the Insert Function options. The Insert Function dialog box offers a wealth of information not only about the different functions available for your use, but about each argument that is used within the functions. If the user chooses to input a function on his or her own, Excel will still offer some help by opening a small help window after typing an equal sign and the name of the function followed by an open parentheses. This help box contains the arguments each separated by commas that are needed to complete the function. Question 8: In the Insert Function dialog box, some arguments are in bold type while others are in regular type. What does this indicate? Answer 8: The bold arguments are required to complete the computations of the function, whereas arguments that are not bold are not required. All required arguments must have cell references or values entered in them, or the result of the function will be an error message. Notice that as the insertion point is moved from one argument to another, the description of the argument changes in the bottom of the Insert Function dialog box. Arguments that are not required are sometimes useful depending upon how the function is being used. For example, when using an IF function, the only required argument is the Logical_test. This means that the Value_if_true and Value_if_false arguments do not need to be entered. If the user does not enter values into these two fields, the result of the function will be a zero. This does not tell if the Logical_test had a true or false result. To make this function useful in a situation where the user is only interested in true results, 4
5 he or she should type the word True in the Value_if_true argument. Question 9: Of the many available functions, which are the most useful? Answer 9: There are many functions available for use in Excel. Depending upon how the application is being used, certain functions will be more useful than others. For example, if the user is working with statistics, the statistical functions will be useful. Statistical functions may not be useful for other types of projects. It is important to be minimally familiar with them all before attempting a complex project. Question 10: Could there ever be a situation in which either a formula or a function could be used? Answer 10: Yes. Remember that functions are simply formulas that are prewritten so that thought does not have to be given to the mathematical operations; only the input must be considered. Therefore, when a function is used, a formula that would give an equivalent result could be written using the same inputs. The use of functions, however, will save time in the creation of spreadsheets. For example, imagine creating an amortization schedule to pay off a loan. This schedule could possibly include SUM, IF, and PMT functions at the very least. If time is spent writing each of these rather than using the Insert Function option, it is time that could be used completing other tasks. On top of the time taken to write the formula, the user will need to test the written formulas very carefully to ensure that all variables have been considered. Therefore, it is recommended that if a function can do what a written formula does, the function should be used. 5
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