This document provides an overview of using formulas and functions in Excel 2010. It covers topics such as: - Using common functions like SUM, AVERAGE, COUNT, MIN, MAX in formulas - Using the AutoSum button to quickly insert functions - Creating formulas with other statistical, date/time, logical functions - Using absolute and relative cell references in formulas - Naming ranges of cells for use in formulas - Checking formulas for errors The document is from a chapter that teaches key skills for working with formulas and functions in Excel, with explanations and step-by-step instructions.

1. askillsapproach
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excel 2010
Chapter 2Chapter 2
Using FormulasUsing Formulas
and Functionsand Functions

2. askillsapproach
© 2012 The McGraw-Hill Companies, Inc. All rights reserved.
Excel 2010 Using Formulas and FunctionsExcel 2010 Using Formulas and Functions
• Skill 2.1 Using Functions in
Formulas
• Skill 2.2 Using AutoSum to Insert
a SUM Function
• Skill 2.3 Creating Formulas
Using the AVERAGE Function
• Skill 2.4 Creating Formulas
Using Counting Functions
• Skill 2.5 Using Other Statistical
Functions
• Skill 2.6 Using Date and Time
Functions
• Skill 2.7 Using Absolute and
Relative References
• Skill 2.8 Naming Ranges of Cells
• Skill 2.9 Working with Named
Ranges
• Skill 2.10 Using Logical
Functions
• Skill 2.11 Calculating Loan
Payments Using the PMT
Function
• Skill 2.12 Finding Data Using the
VLOOKUP Function
• Skill 2.13 Creating Formulas
Referencing Data from Another
Worksheet
• Skill 2.14 Displaying and Printing
Formulas
• Skill 2.15 Checking Formulas for
Errors
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• Functions are
preprogrammed shortcuts for
calculating complex equations
(like the monthly payment
amount for a loan).
• Most functions require you to
provide input called the
arguments.
Excel Skill 2.1Excel Skill 2.1
Using Functions in FormulasUsing Functions in Formulas
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1. Type the formula directly in
the cell or the formula bar.
2. Use Formula AutoComplete
by typing = and then a letter.
Formula AutoComplete
displays a list of potential
matches.
3. On the Formulas tab, select a
function from the Function
Library group, or click the
Insert Function button to
select a function from the
Insert Function dialog box.
4. Use AutoSum to insert
common functions (SUM,
AVERAGE, COUNT, MIN,
and MAX) with a single
mouse click.
Four Basic Ways to Add a Function to a FormulaFour Basic Ways to Add a Function to a Formula
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5. askillsapproach
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Excel Skill 2.2Excel Skill 2.2
Using AutoSum to Insert a SUM FunctionUsing AutoSum to Insert a SUM Function
• SUM function - used to add several cells together.
=SUM(A3:A6)
– The range A3:A6 tells Excel to add the values in all of
the cells between A3 and A6 ( A3 1 A4 1 A5 1 A6 ).
• Ways to Create a SUM Function
– Using the Function Arguments dialog box
– Using Formula AutoComplete
– Using the AutoSum button (much easier because Excel
enters the function arguments for you.)
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6. askillsapproach
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1. Select the cell in which you
want to enter the function.
2. On the Formulas tab, in the
Function Library group, or on
the Home tab, in the Editing
group, click the AutoSum
button.
3. Excel automatically inserts a
formula with the SUM
function, using the range of
cells contiguous to (next to)
the selected cell as the
arguments for the function.
You can increase or decrease
the range of cells selected by
clicking & dragging the corner
of the highlighted cell range.
4. Press Enter to accept the
formula.
To Insert a SUM Function Using AutoSumTo Insert a SUM Function Using AutoSum
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7. askillsapproach
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Excel Skill 2.3Excel Skill 2.3
Creating Formulas Using the AVERAGE FunctionCreating Formulas Using the AVERAGE Function
• AVERAGE function - used to calculate the average value
of a group of values.
=AVERAGE(A3:A6)
–The value of this formula is the average of the values of cells A3
through A6: (A3 + A4 + A5 + A6)/4.
–Average is calculated by adding the values, and then dividing the
sum by the number of values.
• To calculate the average of numbers in more than one
range of values, use a comma to separate arguments:
=AVERAGE(A3:A6,B3:B6)
–The value is the average of the values of cells A3 through A6 and B3
through B6: (A3+A4+A5+A6+B3+B4+B5+ B6)/8.
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8. askillsapproach
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1. Select the cell in which you
want to enter the function.
2. On the Formulas tab, in the
Function Library group, click
the AutoSum button arrow,
or on the Home tab, in the
Editing group, click the
AutoSum button arrow, and
then click Average.
3. Excel will automatically insert
a formula using the
AVERAGE function, using the
range of cells contiguous to
(next to) the selected cell as
the arguments for the
function. Press Enter to
accept the formula.
To Insert an AVERAGE Function Using AutoSumTo Insert an AVERAGE Function Using AutoSum
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9. askillsapproach
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Excel Skill 2.4Excel Skill 2.4
Creating Formulas Using Counting FunctionsCreating Formulas Using Counting Functions
• Counting functions are useful when you need to
know how many numbers or items are in a list, or
how many rows are missing data for a particular
column
• Three basic counting functions in Excel:
– COUNT —Counts the number of cells that contain
numbers within a specified range of cells.
– COUNTA —Counts the number of cells that are not
blank within a specified range of cells. Use COUNTA if
your cell range includes both numbers and text data.
– COUNTBLANK —Counts the number of blank cells
within a specified range of cells.
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10. askillsapproach
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1. Click in the cell where you want
the formula.
2. Type = COUNT to display the
Formula AutoComplete list of
functions that begin with “count”.
3. Double-click the function you
want to use.
4. Excel enters the beginning of
the formula in the cell. Click the
first cell in the range of cells you
want to use for your arguments,
and then drag and release the
mouse button when you reach
the last cell in the range.
5. Press Enter. Excel enters the
cell range as the function
arguments, and adds ) to the
end of the formula.
Use Formula AutoComplete to Enter Counting FunctionsUse Formula AutoComplete to Enter Counting Functions
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11. askillsapproach
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Excel Skill 2.5Excel Skill 2.5
Using Other Statistical FunctionsUsing Other Statistical Functions
• The MIN (minimum) statistical function will give
you the lowest value in a range of values.
= MIN(A3:A6)
• The MAX (maximum) statistical function will give
you the highest value in a range of values.
= MAX(A3:A6)
• To explore the wide variety of complex statistical
functions available in Excel:
–On the Formulas tab, in the Function Library group, click
the More Functions button and point to Statistical, or
open the Insert Function dialog box and select the
Statistical category.
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12. askillsapproach
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1. Select the cell in which you want
to enter the function.
2. On the Formulas tab, in the
Function Library group, click the
AutoSum button arrow, or on the
Home tab, in the Editing group,
click the AutoSum button arrow,
and then click Min to display the
smallest value or Max to display
the highest value.
3. Excel automatically inserts a
formula, using the range of cells
contiguous to (next to) the
selected cell as the arguments
for the function. Increase or
decrease the range of cells
selected by clicking and dragging
the corner of the highlighted cell
range.
4. Press Enter to accept the
formula.
To Use AutoSumTo Use AutoSum
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Excel Skill 2.6Excel Skill 2.6
Using Date and Time FunctionsUsing Date and Time Functions
• NOW function - inserts the current date and time.
= NOW()
• TODAY function - inserts only the current date.
= TODAY()
• Both functions are volatile —that is, they are not
constant.
• These functions do not require arguments.
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1. Select the cell where you
want the date and time to
appear.
2. On the Formulas tab, in the
Function Library group, click
the Date & Time button.
3. Click NOW.
4. When the Function
Arguments dialog box
appears, click OK.
5. If necessary, format the cell
to display both the date and
time.
To insert just the current date,
follow the same steps, but
select the TODAY function
instead.
To Insert the Current Date and TimeTo Insert the Current Date and Time
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15. askillsapproach
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Excel Skill 2.7Excel Skill 2.7
Using Absolute and Relative ReferencesUsing Absolute and Relative References
• A cell’s address, its position in the workbook, is referred to
as a cell reference when it is used in a formula.
• Cell references can be relative, absolute, or mixed.
– Relative reference - a cell reference that adjusts to the new
location in the worksheet when the formula is copied.
• Example: A1
– Absolute reference - a cell reference whose location remains
constant when the formula is copied.
• Example: $A$1
• The $ character before a letter or number in the cell address
means that part of the cell’s address is absolute (nonchanging).
– A mixed reference is a combination cell reference with a row
position that stays constant with a changing column position (or
vice versa).
• Example: $A1
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• When you type a formula into a cell, it
uses relative references by default.
• Excel calculates the position of the
referenced cell relative to the active
cell.
• For example, if cell B17 is the active
cell and you type the formula = B16,
Excel displays the value of the cell that
is up one row from the active cell.
• If you add another row, shifting the
position of cell B17 to cell B18, Excel
adjusts the reference in the formula to
reflect the new cell address that is up
one row from the current position.
• If you copy the formula = B16 from cell
B17 and paste it into cell C17, the
pasted formula will update to = C16 to
reflect the cell address that is up one
row from the new position.
How Relative and Absolute References WorkHow Relative and Absolute References Work
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• But what if you don’t want the cell
reference to adjust?
• For example, cell B13 contains a value
that you want to use in calculations for
multiple cells in a row.
• If you copy the formula =B13*B16 from
cell B17 to cell C17, the formula
updates to =C13*C16 (not what you
intended) because both of the cell
references are relative.
• The reference in cell B13 needs to be
absolute, so it doesn’t update when
copied.
• Use the formula =$B$13*B16 instead
and copy it from cell B17 to cell C17.
The pasted formula will only update the
relative reference (B16).
• The absolute reference ($B$13) will
remain constant. The formula in cell
C17 will be =$B$13*C16.
How Relative and Absolute References WorkHow Relative and Absolute References Work
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Excel Skill 2.8Excel Skill 2.8
Naming Ranges of CellsNaming Ranges of Cells
• Cell references like A4 and J34 do not provide much
information about what data the cell contains—they
just tell you where the cell is located in the worksheet.
• However, you can assign names to cells or ranges of
cells to give your cell references names that are more
user-friendly.
• These names (also called range names or named
ranges) act as a list of shortcuts to the cell locations.
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1. Select the cell or range of
cells to which you want to
assign a name.
2. Type the name in the Name
box to the left of the formula
bar.
3. Press Enter to apply the
name to the cell(s).
To Create a Named RangeTo Create a Named Range
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20. askillsapproach
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1. Select the range of cells you
want to name including the
row or column label.
2. On the Formulas tab, in the
Defined Names group, click
the Create from Selection
button .
3. In the Create Names from
Selection dialog box, click the
check box(es) to indicate
where the names are (top
row, left column, bottom row,
or right column).
4. Click OK.
Automatically Create Named Ranges Using LabelsAutomatically Create Named Ranges Using Labels
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21. askillsapproach
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Excel Skill 2.9Excel Skill 2.9
Working with Named RangesWorking with Named Ranges
• Rather than using a range of cells in your formulas, you can use a
named range. The name will always refer to the cells, even if their
position in the worksheet changes.
• Using named ranges in your formulas also makes it easier for others
to use your workbook. Which formula is easier to understand:
SUM(B5:B8) or SUM(JAN)?
• Formula AutoComplete lists named ranges as well as functions.
• Using the AutoComplete list is a good way to avoid typographical
errors and ensure that you enter the name correctly.
• When you copy and paste a formula containing a named range, the
name does not change with the new position in the workbook (similar
to using an absolute reference).
• If you move a named cell, the name updates with the new cell location
automatically.
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22. askillsapproach
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1. Click the cell where you want
to enter the new formula.
2. Type the formula, substituting
the range name for the cell
references.
3. Press Enter to accept the
formula.
To Use a Named Range in a FormulaTo Use a Named Range in a Formula
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23. askillsapproach
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1. Type an = sign to begin the
formula. As you type
alphabetical characters, Excel
will offer name suggestions.
2. When you find the name you
want, double-click it.
3. Excel inserts the name into
the formula.
To Use Formula AutoComplete with NamesTo Use Formula AutoComplete with Names
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24. askillsapproach
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Excel Skill 2.10Excel Skill 2.10
Using Logical FunctionsUsing Logical Functions
The logical functions group includes:
•IF — Returns one value if a condition is true and another
value if the condition is false.
•AND —Returns TRUE if the all of the arguments are true,
and FALSE if at least one of the arguments is not true.
•OR —Returns TRUE if at least one of the arguments is true,
and FALSE if all of the arguments are false.
•NOT —Returns TRUE if the argument is false, and FALSE if
the argument is true.
•IFERROR —Returns an error message or specified value if
the value of the referenced cell is an error; else it returns the
value of the referenced cell.
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25. askillsapproach
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1. Select the cell where you want to
enter the formula.
2. On the Formulas tab, in the
Function Library group, click the
Logical button.
3. Select IF from list of functions.
4. Enter Logical_test argument. This
argument states the condition to
test for. Use cell references and/or
values with logical operators.
5. Enter Value_if_true argument.
This is the text string or value
displayed if the Logical_test
argument is true.
6. Enter Value_if_ false argument.
This is the text string or value
displayed if the Logical_test
argument is false.
7. Click OK.
To Use the IF FunctionTo Use the IF Function
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26. askillsapproach
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Excel Skill 2.11Excel Skill 2.11
Calculating Loan Payments Using the PMT FunctionCalculating Loan Payments Using the PMT Function
• PMT (payment) function - use to calculate loan payments.
• PMT is based upon constant payments and a constant interest rate.
• Example formula to calculate payments for a $250,000 loan paid in
120 installments at 12 installments per year with an annual percentage
interest rate of 7%:
= PMT(7%/12,120,250000)
• Example formula using named ranges & cell references where
–Interest rate is stored in a cell named Interest_Rate,
–Total number of payments is stored in cell H7
–Amount of the loan is in a cell named Loan
= PMT(Interest_Rate/12,H7,Loan,0,0)
• The result of both of these formulas is –2,902.71.
• Because the result of the formula is a payment, it is expressed as a
negative number.
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27. askillsapproach
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1. Select the cell where you want to
enter the formula.
2. On the Formulas tab, in the Function
Library group, click the Financial
button.
3. Select PMT from the list. Excel
displays the appropriate Function
Arguments dialog box.
4. In the Rate box, enter interest rate
divided by number of payments per
year. In the Nper box, enter total
number of payments over life of
loan.
5. In the Pv box, enter the present
value of the loan.
6. (Optional) In the Fv box, enter the
future value of the loan.
7. (Optional) In the Type box, enter 1 if
payment is at beginning of period.
8. Click OK to enter the formula.
To Use the PMT FunctionTo Use the PMT Function
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28. askillsapproach
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Excel Skill 2.12Excel Skill 2.12
Finding Data Using the VLOOKUP FunctionFinding Data Using the VLOOKUP Function
• Lookup and reference functions return values based on a cell’s
position in a table or array.
• Example: Use the VLOOKUP function to look up the part of a loan
payment that is applied to the principal of the loan by:
– returning the value of column 7 (the Principal column)
– within the range named Loan_Data (cells A20:I123),
– where the value in the first column of the data array (the PmtNo column) is
the value in cell D13:
= VLOOKUP(D13,LoanRange,7)
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29. askillsapproach
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1. Select cell to enter the formula in.
2. On the Formulas tab, in the Function
Library group, click Lookup &
Reference button.
3. Select VLOOKUP from list. Excel
displays the appropriate Function
Arguments dialog box.
4. In Lookup_value box, enter value in
first column to return a corresponding
value for.
5. In Table_array box, enter range of cells
for array (or table or range name).
6. In Col_index_num box, enter column
number from which function should
return matching value.
7. (optional) In Range_lookup box, enter
FALSE to find only an exact match for
value entered in Lookup_value box.
8. Click OK.
To Use the VLOOKUP FunctionTo Use the VLOOKUP Function
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30. askillsapproach
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Excel Skill 2.13Excel Skill 2.13
Creating Formulas Referencing Data from Another WorksheetCreating Formulas Referencing Data from Another Worksheet
• Cell references are not limited to cells within the same
worksheet.
• Reference cells in other worksheets in a workbook or other
workbooks. This is useful when creating summary sheets
or performing analysis on data from multiple sheets.
• For example, this formula will display the value of cell B3
from the Cash Flow worksheet:
= ‘Cash Flow’!B3
• If multiple workbooks are open, click a cell in another
workbook to create an external reference. The reference
will look like this:
= B17 + ‘[Four Year Profit Projections.xlsx]Salaries’!$D$6
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31. askillsapproach
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1. Click the cell where you want
the formula.
2. Type an equal sign ( = ).
3. Navigate to the cell you want
to reference by clicking the
sheet tab and then clicking
the cell.
4. Press Enter to complete the
formula.
To Include a Reference to a Cell From Another SheetTo Include a Reference to a Cell From Another Sheet
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32. askillsapproach
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Excel Skill 2.14Excel Skill 2.14
Displaying and Printing FormulasDisplaying and Printing Formulas
• How do you troubleshoot a worksheet that is
displaying unexpected values?
• When you look at a worksheet, you see only the
results of formulas—cells display the values, not the
formulas themselves.
• When you click a cell, the formula is displayed in the
formula bar. But what if you want to view all of the
formulas in your worksheet at once?
– To display the formulas in the current worksheet instead
of values, on the Formulas tab in the Formula Auditing
group, click the Show Formulas button.
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33. askillsapproach
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1. First display the formulas in
the worksheet by clicking the
Show Formulas button.
2. Next, print the worksheet:
a. Click the File tab.
b. Click Print.
c. At the right side of the
page is a preview of how
the printed file will look.
Adjust the print settings if
necessary.
d. Click the Print button to
send the file to your
default printer.
To Print a Copy of the Worksheet with FormulasTo Print a Copy of the Worksheet with Formulas
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34. askillsapproach
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Excel Skill 2.15Excel Skill 2.15
Checking Formulas for ErrorsChecking Formulas for Errors
• Some worksheet errors are easily identifiable—such as
divide by zero errors: #DIV/0! (Excel cannot calculate a
value to display).
• Other potential errors, like formulas that leave out part of a
cell range, are harder to find.
• Use Excel’s Error Checking function to review a worksheet
for errors.
– The Error Checking dialog box displays each error it finds,
allowing you to resolve or ignore each error in turn.
– If Excel is able to offer a solution to the error, the dialog box
will include a button to accept the suggested fix.
• Click Help on this error button to open Microsoft Office Help.
• Click Ignore Error to dismiss error.
• Click Edit in Formula Bar to fix the error manually.
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35. askillsapproach
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1. On the Formulas tab in the
Formula Auditing group, click
the Error Checking button.
2. The Error Checking dialog
box displays information
about the first error. The
buttons available in the dialog
box will differ, depending on
the type of error found.
3. Click the Next button to see
the next error in your
worksheet.
4. When you have reviewed all
errors, Excel displays a
message that the error check
is complete. Click OK to
dismiss the message box.
To Use Error Checking to Find Errors in WorksheetTo Use Error Checking to Find Errors in Worksheet
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36. askillsapproach
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1. When a Smart Tag appears, move
mouse over icon to display a ToolTip
describing possible error.
2. Click Smart Tag arrow to display
possible error resolutions.
3. To keep formula as it is, select Ignore
Error.
4. To resolve error, select an option:
1. The first option is usually a suggestion
of how to resolve error. Click to
accept Excel’s suggestion.
2. Select Help on this error to open
Microsoft Office Help.
3. Select Edit in Formula Bar to
manually edit the formula.
4. Select Error Checking Options. . . to
open Options dialog box and modify
the way Excel checks for errors.
5. After making selection from Smart Tag
options, the Smart Tag is dismissed.
To Use Smart Tags to Resolve Errors in FormulasTo Use Smart Tags to Resolve Errors in Formulas
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37. askillsapproach
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Excel 2010 Using Formulas and Functions RecapExcel 2010 Using Formulas and Functions Recap
• Skill 2.1 Using Functions in
Formulas
• Skill 2.2 Using AutoSum to Insert a
SUM Function
• Skill 2.3 Creating Formulas Using
the AVERAGE Function
• Skill 2.4 Creating Formulas Using
Counting Functions
• Skill 2.5 Using Other Statistical
Functions
• Skill 2.6 Using Date and Time
Functions
• Skill 2.7 Using Absolute and Relative
References
• Skill 2.8 Naming Ranges of Cells
• Skill 2.9 Working with Named
Ranges
• Skill 2.10 Using Logical Functions
• Skill 2.11 Calculating Loan
Payments Using the PMT Function
• Skill 2.12 Finding Data Using the
VLOOKUP Function
• Skill 2.13 Creating Formulas
Referencing Data from Another
Worksheet
• Skill 2.14 Displaying and Printing
Formulas
• Skill 2.15 Checking Formulas for
Errors
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