INTRODUCTION TO EXCEL BASICS

Knowing the fundamentals of Microsoft Excel will make you more confident in
using spreadsheet templates. When you start the Excel program, it opens a blank
spreadsheet. Figure 1 shows a blank spreadsheet with some of its parts identified.
The title bar shows that Excel has opened a workbook named Book1. In Excel ter-
minology, a workbook consists of many worksheets, or simply sheets. The figure
shows three sheets with the tabs Sheet1, Sheet2, and Sheet3. Sheet1 is currently
active. A sheet consists of many rows and columns. Rows are numbered 1, 2, 3, . . . ,
and columns are labeled A, B, C, . . . , Z, AA, AB, … A sheet may have thousands of
rows and hundreds of columns. You can use the scrollbars to navigate to desired
columns and rows.
In the figure, Column B and Row 4 are highlighted. The cell at the intersection of
column B and row 4 is called cell B4. To select a cell, click on that cell with the mouse
pointer. The cell is highlighted with heavy borders and the name of the selected cell
appears in the Name box.
After you select a cell you can enter into it a text, a number, or a formula.
Whatever entry you make will appear on the formula bar. You can also edit the
entries in the formula bar as you would edit any text.
We shall walk through detailed instructions to create an invoice. If you wish, you
can take a peek at the final invoice in Figure 5. We will then turn it into a template,
which is shown in Figure 6. In what follows, the steps are shown as bullet points.
Perform these steps on your computer as you read.

• Launch the Excel program. You can do this by double-clicking on the Excel
icon. If you don’t see the icon, you have to locate Excel in Program Files and
launch it.
• Select cell B4 and enter the text “Description.” Press Enter.

FIGURE 1 Blank Excel Spreadsheet with Parts Labeled

1
2 Introduction to Excel Basics

FIGURE 2 Widening Column B

B4 = Description
A B C D E
1
2 Drag the mouse to the
3
right to increase the
width of column B.
4 Description
5
6
7
8
9
10
11
12
13
Sheet1 Sheet2 Sheet3

We need a wider column for description. You can increase or decrease the width of
a column by dragging, with the mouse pointer, the line between two column labels.

• Take the mouse pointer to the short line segment between the column labels B
and C. Notice how the pointer changes its shape when it is on this line segment.
It becomes a vertical line with two short arrows to the left and to the right, as
seen in Figure 2. Drag the mouse to the right to widen column B to 20.00
points. (You would drag it to the left to reduce the width.)
• With cell B4 still selected, click on the Bold icon to get boldface fonts. (When
you place the mouse pointer on any icon or a drop-down box, the pop-up tool
tip shows its name. This should help you to identify every icon.)
• Click the Center icon to center the text inside the cell.
• Similarly enter the text “Qty” in cell C4, make it boldface, and center it.
• Reduce the width of column C to 4.00 points.
• Enter “Price” in cell D4, make it boldface, and center it.
• Enter “Invoice” in cell A1. Make it bold. Using the Font Size drop-down box,
increase the font size to 14. Using the Font Color drop-down box, change the
color to Blue.
• Reduce the width of column A to 2.00 points.
• See Figure 3. Make the entries shown in the figure under the Description, Qty,
and Price columns. Notice how texts automatically align to the left side of the
cell and numbers to the right side.

1 Excel Formulas
Consider cell E5. It should be the product of the quantity in cell C5 and the price in
cell D5. If you do this multiplication yourself and enter the result in cell E5, you are
probably not having much fun. You want the spreadsheet to do it for you. So, you are
going to give a precise instruction to the spreadsheet.

• Enter the formula =C5*D5 in cell E5. The * is the multiplication symbol in
Excel formulas. Notice the = sign at the beginning of the formula. All Excel
 Introduction to Excel Basics 3

FIGURE 3 The Entries

A B C D E
1 Invoice
2
3
4 Description Qty Price Amount
5 Shampoo 2 3.59
6 Conditioner 2 2.79
7 Soap 5 0.95
8 Kleenex 4 1.95
9
10

formulas must start with the = sign. Notice how the spreadsheet evaluates the
formula and displays the result of the formula in the cell and not the formula
itself. The formula appears in the formula bar.

Copying Formulas
Consider cell E6. It should have the formula =C6*D6. But this is similar to the
formula you entered in cell E5. In such cases, copying the formula from one cell
into another is easier. You can use the Copy and Paste icons to do this. But there is an
easier way, which helps you copy the formula into cells E6, E7, and E8 in one stroke.

• Select cell E5, if it is not already selected. The heavy border that outlines the
cell has a dot at the bottom right corner. This dot is called the fill handle.
Drag the fill handle down to fill cells E6, E7, and E8. When you fill cells in this
manner, Excel will change the cell references in the formulas in a very intuitive
way. For instance, click on cell E6 and look at the formula bar. It shows =C6*D6
although the original formula in cell E5 was =C5*D5. In other words, Excel
has changed the 5s into 6s because the formula was copied downward. (If the
filling was toward the right, instead of downward, Excel would have changed
the C to D and D to E. It would not have changed the 5s.) Similarly, the
formulas in cells E7 and E8 are also different. These are the formulas needed
in those cells, and thus the changes that Excel made in the formulas saved you
some work.

More items can be added to the invoice. Let us assume that 10 items is the most
allowable and leave enough space for up to 10 items. We shall get the total amount in
row 15.

• Enter “Total” in cell D15.

2 Excel Functions
To get the total amount in cell E15, it appears you need to enter the formula
=E5+E6+E7+E8+E9+E10+E11+E12+E13+E14

This formula is tedious, and it would get more tedious if there are more cells to add.
Indeed, we often have to add hundreds of cells. So we find a shortcut. The function
SUM available in Excel can be used to add a range of cells with a very compact formula.
4 Introduction to Excel Basics

A range of cells is any rectangular array of cells. The range A1:C4, for instance,
contains 4 rows and 3 columns of cells. Note the use of the : symbol in the reference
to a range.
Excel contains numerous powerful functions that can compute complex quanti-
ties. Click on the Paste function icon. In the dialog box that appears, you can see a
long list of Excel functions available. Close the dialog box.

• Enter the formula =SUM(E5:E14) in cell E15. Note that the argument of a
function is entered in parentheses, as you would in algebra.

We shall next compute sales tax at 6%.

• Enter 6% in cell C16.

• Enter “Sales Tax” in cell D16.
• Enter the formula =C16*E15 in cell E16.

Finally, we compute the total amount due.

• Enter “Total due” in cell D17.

• Enter the formula =E15+E16 in cell E17.

Your spreadsheet should now look like the one in Figure 4. The dollar figure in cell
E8 has only one decimal place and those in cells E16 and E17 have four. Also, the
dollar sign is missing everywhere in the Price and Amount columns. To fix this,

• Drag the mouse from the center of cell D5 to the center of cell D14. You have
selected the range D5:D14. Click on the $ icon. This formats all the prices as
dollar values with two decimal places for cents.
• Select the range E5:E17 similarly, and click the $ icon. The dollar values now
appear properly.

FIGURE 4 Showing Tax and Total Due

A B C D E
1 Invoice
2
3
4 Description Qty Price Amount
5 Shampoo 2 3.59 7.18
6 Conditioner 2 2.79 5.58
7 Soap 5 0.95 4.75
8 Kleenex 4 1.95 7.8
9
10
11
12
13
14
15 Total 25.31
16 6% Sales Tax 1.5186
17 Total due 26.8286
 Introduction to Excel Basics 5

We realize that although no items appear in rows 9 though 14, some items may be
entered there in the future and therefore we need formulas in the range E9:E14.

• Select cell E8. Drag the fill handle downward to cell E14. The formulas are
copied.

But the range E9:E14 contains the distracting display of “$ ⫺ ” for zero dollars. One
way to get rid of this distraction is to instruct the computer to display the amount only
when there is an entry in the Price column.1 This can be done using the IF function.
The IF function displays one of two specified results depending on whether a speci-
fied condition is true or false. For instance, the formula =IF(A1=5,10,20) would
display 10 if cell A1 contains 5, and 20 if cell A1 contains anything else.

• Click on cell E5. Change the formula to =IF(D5<>””,C5*D5,””). The

symbol <> means “not equal to.” The symbol ”” contains nothing in quotes,
and signifies an empty text. The formula as a whole tells the spreadsheet to
display the amount only if cell D5 is not empty.
• Using the fill handle, copy the formula in cell E5 downward to cell E14. This
updates all the formulas.

Next we shall add borders.

• Select the range B4:E14. Click the down arrow of the Borders drop-down box,
and select the All Borders icon.
• Select the range E15:E17 and click on the Borders icon. Note that the All
Borders option stays selected and therefore you need not select it again. Just
click on the Borders icon.

Now that we have borders for the rows and columns, we don’t need the gridlines of
the spreadsheet.

• On the Page Layout tab, in the Sheet Options group, uncheck the View box
under Gridlines.

You now have the complete invoice, and it should look like the one in Figure 5.

3 The Need for Templates

If you need to create another invoice, you wouldn’t want to go through all these steps
all over again. You would use a copy of this spreadsheet. But what if your friends or
co-workers wanted to create an invoice? A copy of your spreadsheet would be unfa-
miliar to them. In particular, they would not know that some important formulas had
been used in column E. The solution is to turn your spreadsheet into a template. A
well-designed template with necessary notes and instructions included in the tem-
plate itself is usable by anyone.
Also, the rigamarole of the steps can get extremely tedious for more complex
problems. An average statistical problem you see in this textbook is more complex
than creating an invoice. It would require complicated formulas and maybe some
charts. Therefore, for every technique in this book, a template has been provided

1
Actually, we should check that both Qty and Price are available. It can be done using the AND function. For
simplicity, we shall check only the Price entry.
6 Introduction to Excel Basics

FIGURE 5 The Final Invoice

A B C D E
1 Invoice
2
3
4 Description Qty Price Amount
5 Shampoo 2 $ 3.59 $ 7.18
6 Conditioner 2 $ 2.79 $ 5.58
7 Soap 5 $ 0.95 $ 4.75
8 Kleenex 4 $ 1.95 $ 7.80
9
10
11
12
13
14
15 Total $ 25.31
16 6% Sales Tax $ 1.52
17 Total due $ 26.83

rather than detailed steps for solving the problem. The templates can also help the
user to conduct sensitivity and decision analyses using Goal Seek and Solver facilities.

Creating the Template

We shall see how to turn the Invoice spreadsheet into a template.
In any template, the user will input some data. For an invoice, the user needs to
enter Description, Qty, and Price of each item. The user also may want to change the
sales tax rate. Accordingly, we should leave the range B5:D14 and cell C16 unlocked
and shaded in green. The rest of the spreadsheet should be locked, especially the for-
mulas in column E.

• Select the range B5:D14.

• With the Control (Ctrl) key pressed, click on cell C16. Using the Control key in
this manner you can select multiple ranges at once.
• On the Home tab, in the Cells group, select Format and then choose Format Cells.
• Click the Protection tab and uncheck the Locked box.
• Using the Fill color drop-down box, shade the ranges in green.
• Select cell E17. Make the font bold and red. Any result is shown in bold red
font in the templates.

The user may want a title for the invoice. So we provide an area at the top for a title.

• Select the range C1:E1. Click the Merge and Center icon. Merging turns three
cells into one cell.
• Use the Format cells command under the Format menu to unlock the cell and
shade it green. Enter “Title.”
• Enter “Enter the data in green shaded cells” in cell A3 and color the font
magenta. Instructions are in the magenta font in the templates.
 Introduction to Excel Basics 7

FIGURE 6 The Template

A B C D E
1 Invoice Title
2
3 Enter the data in the green shaded cells.
4 Qty Price Amount
5 Shampoo 2 $ 3.59 $ 7.18
6 Conditioner 2 $ 2.79 $ 5.58
7 Soap 5 $ 0.95 $ 4.75
8 Kleenex 4 $ 1.95 $ 7.80
9
10
11
12
13
14
15 Total $ 25.31
16 6% Sales Tax $ 1.52
17 Total due $ 26.83

Now you are ready to protect the sheet so that locked cells cannot be altered.

• Click the Protect Sheet in the Changes group on the Review tab. In the dialog
box that appears, click the OK button. Avoid using any password, since the
user may want to unprotect the sheet for some reason. All the templates in this
textbook are protected without password.

Your template should look like the one in Figure 6. Save the template as
MyInvoice.xls. You can share this template with your friends.

Limitations of the Template

Some limitations of the template are:

1. The template can accommodate up to 10 items only.

2. The user may enter a text where a number is expected. If the text “Two” is
entered as quantity, the template will not calculate the amount. At times a
number may be too large for Excel to handle. In general, the user may input
something unacceptable in some cell, which can make the template produce
error messages rather than results.
3. The user may accidentally enter, say, a negative number for quantity. The
template will accept negative values and will calculate some result. Unaware
of the accidental error, the user may report a wrong total amount due. An
undetected accidental error is a serious problem common to all types of
computer applications.
4. If there are additional items such as shipping and handling charges, the user
may not know what to do.
8 Introduction to Excel Basics

With some patience and effort, fixing or alleviating these limitations is possible.
But some limitations will always be found.

Exercise
Consider a restaurant check for a meal, to which you want to add your tip. Create a
template that calculates the tip amount as a user-defined percentage of the check
amount. The template should also compute the total amount including the tip. When
you are finished, look up the template Tip Amount.xls and compare.