Accountancy: Class 12 (Part 1) — Chapter 2: Spreadsheet

Introduction & Basic Concepts

A spreadsheet (or worksheet) is a configuration of rows and columns used to record, calculate, and compare numerical or financial data. In MS-Excel 2007, the user interface features a series of horizontal tabs known as the Ribbon.

Workbooks and Worksheets

A file in Excel is called a Workbook, which is a collection of Worksheets. By default, three sheets (Sheet1, Sheet2, Sheet3) are available. Only one sheet can be the Active Worksheet at a time.

Rows, Columns, and Cells

  • Rows: Horizontal vectors numbered numerically from 1 to 65,536.
  • Columns: Vertical vectors identified by letters (A, B, C, ... IV) totaling 256.
  • Cell: The intersection of a row and a column, identified by a unique Cell Address (e.g., A1).
  • Active Cell: The cell currently pointed to by the cursor.

Cell References

A Cell Reference identifies the location of a cell or group of cells (range, e.g., A1:E2):

  • Relative Reference: Adjusts automatically when a formula is copied to another cell (e.g., A1).
  • Absolute Reference: Remains fixed on a specific cell using dollar signs (e.g., $C$4).
  • Mixed Reference: Holds either the row or column constant (e.g., $C4 or C$4).

Navigation Keystrokes

MovementKey Stroke
One cell downDown arrow or Enter
One cell upUp arrow
One cell leftLeft arrow
One cell rightRight arrow or Tab
Top of WorksheetCtrl + Home
End of Worksheet dataCtrl + End
Elements of Spreadsheet

Labels, Formulas, and Functions

  • Labels: Text or special characters used for descriptive information. They cannot be treated mathematically.
  • Formulas: Mathematical calculations on a set of cells that must start with an equal (=) sign.
  • Functions: Special keywords entered into a cell to perform and process data appended within brackets.

Order of Mathematical Operations

Excel follows algebraic rules to determine the order of operations, remembered by acronyms such as GEMS, PEMDAS, or BEMDAS:

  • GEMS: Grouping, Exponents, Multiplication/Division, Subtraction/Addition
  • PEMDAS: Parentheses, Exponents, Multiplication/Division, Addition/Subtraction
  • BEMDAS: Brackets, Exponents, Multiplication/Division, Addition/Subtraction

Basic and Derived Values

Basic values are independent inputs, while derived values are calculated using formulas.

If quantity ($Q$) of an item is purchased at a price ($P$), the derived value ($V$) is calculated as:

$$V = Q \times P$$
Spreadsheet Functions

Date and Time Functions

  • TODAY(): Returns the serial number of the current date.
  • NOW(): Returns the serial number of the current date and time.
  • DAY(serial_number): Returns the day of a date as an integer (1 to 31).
  • MONTH(serial_number): Returns the month of a date as an integer (1 to 12).
  • YEAR(serial_number): Returns the year of a date as an integer (1900 to 9999).
  • DATEVALUE(date_text): Converts a date in text format to a serial number.

Mathematical and Statistical Functions

  • SUM(range): Adds all numbers in a range of cells.
  • AVERAGE(range): Returns the average (arithmetic mean) of the arguments.
  • COUNT(range): Counts the number of cells that contain numbers.
  • COUNTA(range): Counts the number of non-blank cells.
  • COUNTBLANK(range): Counts the number of empty cells.
  • COUNTIF(range, criteria): Counts the number of cells that meet a given criteria.
  • SUMIF(range, criteria, sum_range): Adds cells specified by a given criteria.
  • ROUND(number, num_digits): Rounds a number to a specified number of digits.
  • ROUNDUP(number, num_digits): Rounds a number up, away from zero.
  • ROUNDDOWN(number, num_digits): Rounds a number down, toward zero.

Text Manipulation Functions

  • TEXT(value, format_text): Converts a numeric value to text in a specific number format.
  • CONCATENATE(text1, text2, ...): Joins two or more text strings into one text string.

Logical Functions

  • IF(logical_test, value_if_true, value_if_false): Returns one value if a condition is true and another if false.
  • AND(logical1, logical2, ...): Returns TRUE if all arguments evaluate to TRUE.
  • OR(logical1, logical2, ...): Returns TRUE if any argument evaluates to TRUE.

Lookup and Reference Functions

  • LOOKUP(lookup_value, lookup_vector, result_vector): Looks up a value in a one-row or one-column range and returns a value from the same position in a second range.
  • VLOOKUP(lookup_value, table_array, col_index_num, range_lookup): Searches for a value in the first column of a table array and returns a value in the same row from another column.
  • HLOOKUP(lookup_value, table_array, row_index_num, range_lookup): Searches for a value in the top row of a table array and returns a value in the same column from another row.

Financial Functions

  • ACCRINT: Returns the accrued interest for a security that pays periodic interest.
    $$ACCRINT = par \times \frac{rate}{frequency} \times \times \frac{A}{NL}$$
  • CUMIPMT(rate, nper, pv, start_period, end_period, type): Returns the cumulative interest paid between two periods.
  • PV(rate, nper, pmt, fv, type): Returns the present value of an investment.
  • FV(rate, nper, pmt, pv, type): Returns the future value of an investment.
  • PMT(rate, nper, pv, fv, type): Calculates the periodic payment for an annuity.
  • RATE(nper, pmt, pv, fv, type, guess): Returns the interest rate per period of an annuity.
  • NPV(rate, value1, value2, ...): Calculates the net present value of an investment.
    $$NPV = \times \frac{values_i}{(1 + rate)^i}$$
Data Entry, Validation & Formatting

Data Entry and Import

Data can be entered manually, filled automatically using the Fill Handle, or imported from external text files (such as .txt or .csv files) using the "From Text" option under the Data tab.

Data Validation

Data Validation restricts the type of data or values users can enter into a cell. It can be used to create drop-down lists, set limits (e.g., age between 18 and 58), or enforce custom formulas (e.g., preventing duplicate entries using COUNTIF).

Formatting Tools

  • Number Formatting: Formats numbers as currency, percentages, dates, or custom formats.
  • Conditional Formatting: Changes the appearance of cells based on specified conditions (e.g., highlighting values using color scales or data bars).
  • Merging Cells: Combines two or more adjacent cells into one large cell.
Reports and Pivot Tables

Data Tables

  • One-Variable Data Table: Shows the results of substituting different values in one formula.
  • Two-Variable Data Table: Uses one formula with two lists of input values.

Pivot Tables

A Pivot Table is an interactive way to quickly summarize, analyze, and explore large amounts of data. It allows users to group data by categories, subtotal values, and pivot rows to columns to see different summaries of the source data.

Common Errors in Spreadsheet