How to create an Excel formula by using defined names

To take a step further, you can create a name for a certain cell or a range of cells, and then refer to that
cell(s) in your Excel formulas by simply typing the name.

The fastest way to create a name in Excel, is to select a cell(s) and type the name directly in the Name
Box. For example, this is how you create a name for cell A2:

A professional-like way to define a name is via the Formulas tab > Defined names group

In this example, I've created the following 2 names:

 revenue for cell A2

 expenses for cell B2

And now, to calculate the net income, you can type the following formula in any cell on any sheet within
the workbook in which those names were created: =revenue-expenses

In the same manner, you can use names instead of cell or range references in arguments of Excel
functions.

For example, if you create the name 2015_sales for cells A2:A100, you can find a total of those cells by
using the following SUM formula: =SUM(2015_sales)

Of course, you can get the same result by supplying the range to the SUM function: =SUM(A2:A100)

However, defined names make Excel formulas more understandable. Also, they can significantly
expedite creating formulas in Excel especially when you are using the same range of cells in multiple
formulas. Instead of navigating between different spreadsheets to find and select the range, you just
type its name directly in the formula.

How to make Excel formulas by using functions

Excel functions are nothing else than predefined formulas that perform the required calculations behind
the scene.
Each formula begins with an equal sign (=), followed by the function name and the function arguments
entered within the parentheses. Each function has specific arguments and syntax (particular order of
arguments).

For more information, please see a list of the most popular Excel functions with formula examples and
screenshots.

In your Excel spreadsheets, you can create a function-based formula in 2 ways:

 By using the function wizard

 By writing a formula in a cell or formula bar

Create a formula in Excel by using the Function Wizard

If you do not feel very comfortable with Excel spreadsheet formulas yet, the Insert Function wizard will
give you a helpful hand.

1. Run the function wizard.

To run the wizard, click the Insert Function button on the Formulas tab > Function Library group, or pick
a function from one of the categories:

Alternatively, you can click the Insert Function button    to the left of the formula bar.

Or, type the equal sign (=) in a cell and pick a function from the drop-down menu to the left of the
formula bar. By default, the drop-down menu displays 10 most recently used functions, to get to the full
list, click More Functions...

2. Find the function you want to use.

When the Insert Function wizard appears, you do the following:

 If you know the function name, type it in the Search for a function field and click Go.

 If you are not sure exactly what function you need to use, type a very brief description of the
task you want to solve in the Search for a function field, and click Go. For example, you can type
something like this: "sum cells", or "count empty cells".

 If you know what category the function belongs to, click the small black arrow next to Select a
category and choose one of the 13 categories listed there. The functions belonging to the
selected category will appear in the Select a function

You can read a short description of the selected function right under the Select a function box. If you
need further details regarding that function, click the Help on this function link near the bottom of the
dialog box.
Once you've found the function you wish to use, select it and click OK.

3.  Specify the function arguments.

In the second step of the Excel function wizard, you are to specify the function's arguments. Good news
is that no knowledge of the function's syntax is required. You just enter the cell or range references in
the arguments' boxes and the wizard will take care of the rest.

To enter an argument, you can either type a cell reference or range directly into the box. Alternatively,
click the range selection icon next to the argument (or simply put the cursor into the argument's box),
and then select a cell or a range of cells in the worksheet using the mouse. While doing this, the function
wizard will shrink to a narrow range selection window. When you release the mouse button, the dialog
box will be restored to its full size.
A short explanation for the currently selected argument is displayed right under the function's
description. For more details, click the Help on this function link near the bottom.

Excel functions allow you to perform calculations with cell residing on the same worksheet, different
sheets and even different workbooks. In this example, we are calculating the average of sales for 2014
and 2015 years located in two different spreadsheets, which in why the range references in the above
screenshot include the sheet names. Find more about how to reference another sheet or workbook in
Excel.

As soon as you've specified an argument, the value or array of values in the selected cell(s) will be
displayed right to the argument's box.

4. Complete the formula.

Write a formula directly in a cell or formula bar

As you've just seen, creating a formula in Excel by using the function wizard is easy, thought it's quite a
long multi-step process. When you have some experience with Excel formulas, you might like a faster
way - typing a function directly into a cell or formula bar.

As usual, you start by typing the equal sign (=) followed by the function name. As you do this, Excel will
perform some kind of incremental search and display a list of functions that match the part of the
function's name you've already typed:

So, you can either finish typing the function name on your own or select from the displayed list. Either
way, as soon as you type an opening parenthesis, Excel will show the function screen tip highlighting the
argument you need to enter next. You can type the argument in the formula manually, or click a cell
(select a range) in the sheet and have a corresponding cell or range reference added to the argument.

After you've input the last argument, type the closing parenthesis and hit Enter to complete the formula.
Tip. If you are not quite familiar with the function's syntax, click the function name and the Excel Help
topicwill pop-up right away.

This is how you create formulas in Excel. Nothing difficult at all, is it? In the next few articles, we will
continue our journey in the intriguing realm of Microsoft Excel formulas, but those are going to be short
tips to make your work with Excel formulas more efficient and productive. Please stay tuned!