How to Create a “Chainsaw” List of Excel Worksheet Functions

 

By David Ringstrom, CPA

Depending upon your version of Excel, you have nearly 500 different worksheet functions at your disposal. Some worksheets functions, such as CUMIPMT and NPER, are like the chainsaw in my garage. I don’t use them very often, but when I do, no other tool will suffice. Other functions are more akin to screwdrivers and pliers in that I use these so often that I can type them in my sleep. In this article I’ll show you an easy way to keep a “chainsaw” list of functions at the ready, so you can avoid trying to remember “how’d I do that before?”

We’ll store our list in an unlikely location known as the Name Box. It’s pretty much impossible to use Excel and not notice the Name Box, which appears just above the upper-left-hand corner of the worksheet frame. Most users know this as the space in Excel where you can determine the address of the currently selected cell.

 

Continue reading on www.accountingweb.com

 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

 

Build a Dynamic Income Tax Calculator – Part 2 of 2

 

By David H. Ringstrom, CPA

 

(If you didn't already do so in Part 1, click here to download the accompanying Income Tax Calculator spreadsheet.)

 

Last month I explained how to use the VLOOKUP function to cross-reference tax rates from a tax rate table. I then extended the functionality by creating 4 different tables — Single, Married-Joint, Married-Single, and Head of Household, as shown in Figure 1. After assigning a range name to each table, I used Microsoft Office Excel’s Data Validation feature to create an in-cell drop-down list comprised of these range names. Finally, I modified my VLOOKUP functions to use Excel’s INDIRECT function. INDIRECT replaced the static look-up range originally specified in the VLOOKUP formula. If I choose Married-Joint from the list, the VLOOKUP function will calculate the tax due based on that table. I can choose Married-Single from the list to determine the additional tax due under that filing status. At this point I have an efficient calculator for determining the amount due based on a taxable income input, but I’d rather not have 4 separate tables. This month I’ll dig deeper, and show you how to create a single table of tax rates, as shown in Figure 2. The final result will involve two rather complex formulas, but we’ll build them a step at a time.

Tax Calculator - Figure 1Figure 1: The VLOOKUP version of the tax calculator relies on four separate rate tables.

 

Tax calculator - Figure 2Figure 2: The new tax calculator will rely on a single rate table.

Understand MATCH

The MATCH function is akin to VLOOKUP — you specify what to look for, where to look, and the type of match that you’d like. When the MATCH function finds the criteria you specify, it returns the position number within the list —otherwise it returns #N/A. The position number can then be used within an INDEX function to return a specific value, much like VLOOKUP or HLOOKUP. Although VLOOKUP is a useful look-up function, your look-up criteria must always be the first column of your data table. Instead, the INDEX/MATCH combination enables you to create a look-up based on any column within the table.

The MATCH function has three arguments:

  • Look-up value: What we’re looking for, such as a taxable income amount.
  • Look-up array: A single column range that contains the potential look-up values, such as the taxable income tiers associated with various income tax rates.
  • Match type: We can choose from three different match types:
    • -1 instructs MATCH to find the smallest value that is greater than or equal to the look-up value. In this case the list must be sorted in descending order.
    • 0 instructs MATCH to find an exact match. In this case the list can be in any order.
    • 1 instructs MATCH to find the largest value that is less than or equal to the look-up value. In this case the table must be sorted in ascending order.

Since MATCH only returns the position number within the list, we’ll then use the INDEX function to return actual amounts from the table.

Comprehend INDEX

I only have space in this article to describe the reference capability of the INDEX function, but Excel’s Help feature discusses the array and multiple area capabilities of INDEX. The reference capability of INDEX has three arguments:

  • Reference: Typically this is the address of a table, such cells B2:J8 in Figure 2.
  • Row number: This argument tells the INDEX function to look at a specified row within the table. In the case of our tax calculator, we’ll use the MATCH function to provide this value.
  • Column number: This optional argument provides the column coordinate. You can omit the column number if you provide a single-column range for the reference argument.

Appreciate OFFSET

Not many Excel users know about the OFFSET function. In essence, it’s a means for shifting a range a certain number of columns and/or rows away from a starting point. In the case of our tax calculator, we’ll use OFFSET to have the MATCH function refer to the proper columns within our tax rate table. The OFFSET function has five arguments:

  • Reference: The starting point for our range, such as A2:A8.
  • Rows: The number of rows away from the starting point that you’d like the range to be shifted. Use a negative number to shift the range upward, or a positive number to move it down. Specify zero if you do not want to shift the range from the starting point. We’ll use zero, because we won’t want to shift the rows.
  • Columns: The number of columns away from the starting point that you’d like the range to be shifted. Use a negative number to shift the range to the left, or a positive number to move it to the right. Specify zero if you do not want to shift the range from the starting point. We’ll use MATCH to shift the range to the right to correspond with the filing status that we choose from the drop-down list.
  • Height: Indicates the height of the range in rows. Omit the argument if you don’t want to adjust the height of the range. We’ll omit this since we won’t need to adjust the height of our range.
  • Width: Indicates the width of the range in columns. Omit this argument if you don’t want to adjust the width of the range. We’ll omit this since we won’t need to adjust the width of our range.

Create the Tax Calculator

Now that we have the function basics out of the way, let’s build a tax table that refers to a single table instead of four different tables.  Enter these values in cells A2 through A8 of a blank worksheet:

A2:

Marginal Rate

A3:

10%

A4:

15%

A5:

25%

A6:

28%

A7:

33%

A8:

35%

 

Enter these values in cells B2 through C8 of the worksheet:

B2:

 Single

C2:

Base Tax

B3:

0.00

C3:

0.00

B4:

        8,026.00

C4:

802.50

B5:

      32,551.00

C5:

4,481.25

B6:

      78,851.00

C6:

16,056.25

B7:

   164,551.00

C7:

40,052.25

B8:

   357,701.00

C8:

103,791.75

 

Enter these values in cells D2 through E8 of the worksheet:

D2:

Married-Joint

E2:

Base Tax

D3:

0.00

E3:

0.00

D4:

16,051.00

E4:

802.50

D5:

65,101.00

E5:

4,481.25

D6:

131,451.00

E6:

16,056.25

D7:

200,301.00

E7:

40,052.25

D8:

357,701.00

E8:

103,791.75

 

Enter these values in cells F2 through G8 of the worksheet:

F2:

Married-Single

G2:

Base Tax

F3:

0.00

G3:

0.00

F4:

8,026.00

G4:

802.50

F5:

32,551.00

G5:

4,481.25

F6:

65,726.00

G6:

12,775.00

F7:

100,151.00

G7:

22,414.00

F8:

178,851.00

G8:

48,385.00

 

Enter these values in cells H2 through I8 of the worksheet:

H2:

Head of Household

I2:

Base Tax

H3:

0.00

I3:

0.00

H4:

11,451.00

I4:

1,145.00

H5:

43,651.00

I5:

5,975.00

H6:

112,651.00

I6:

23,225.00

H7:

182,401.00

I7:

42,755.00

H8:

357,701.00

I8:

100,605.00

 

Add these headings to the spreadsheet:

B10:

Taxable Income

C10:

Tax Rate

D10:

Tax Due

E10:

Filing Status

 

Enter 125,000 in cell B11, and then use Data Validation to create an in-cell drop-down list in cell E10:

  1. Excel 2007: Choose the Data Validation icon in the Data Tools section of the Data ribbon.
    1. Excel 2003 or earlier: Choose Tools, and then Data Validation.
  2. In all versions of Excel, choose List, and then enter this into the Source field, as shown in Figure 3:

Single,Married-Joint,Married-Single,Head Of Household

Tax calculator 2 - Figure 3
Figure 3:
Enter the filing statuses in the Source field of the Data Validation window.

 

Caution: Be sure that the contents of the Source field exactly match the values that you entered in cells B2, D2, F2, and H2.

  1. Click OK. At this point, a drop-down list should appear when you click on cell E11, as shown in Figure 4. Choose Single from this list.

Tax calculator - Figure 4Figure 4: Data validation can provide an in-cell drop-down list.

 

 

We’ll now enter the formula to determine the tax rate. Enter this formula in cell C11:

=MATCH(B11,B3:B8,1)

Based on an input of 125,000 in cell B11, the formula should return the number 4. We’ve instructed MATCH to look at the taxable income for the Single filing status, and asked it to find the closest income bracket for $125,000. Next, we’ll add the INDEX function, so that we can get the actual tax rate. Modify the formula in cell C11 to be as follows:

=INDEX(A3:A8,MATCH(B11,B3:B8,1))

 

At this point the formula should return 28%. However, we’re referencing a static range of B3:B8 for our income brackets, and instead we want the formula to shift automatically based on our choice in cell E11. To do so, we’ll employ the OFFSET function. As shown in Figure 5, modify the formula in cell C11 to match this:

=INDEX(A3:A8,MATCH(B11,OFFSET(A3:A8,0,MATCH(E11,A2:I2,0)-1),1))

Tax calculator - Figure 5Figure 5: This formula determines the tax rate based on the taxable income amount and filing status.

 

 

Although this may look intimidating, we basically replaced the B3:B8 portion of the formula with this component:

OFFSET(A3:A8,0,MATCH(E11,A2:I2,0)-1)

Our OFFSET function contains these arguments:

  • Reference: A3:A8 serves as the starting point.
  • Rows: Zero indicates that we don’t want to shift the range up or down.
  • Columns: We use an additional MATCH function to determine which column in the table has our filing status. Notice that this time we used a zero for the match type, since we need an exact match. I subtracted 1, because in the case of Single, the MATCH function inside OFFSET returns 2, but I only need to shift over 1 column.
  • Height: I omitted this argument, since I didn’t need to resize the range.
  • Width: I omitted this argument, since I didn’t need to resize the range.

At this point the formula should return 28%. This number should change to 25% if you choose Married-Joint in cell E11, 33% for Married-Joint, or  remain at 28% if you choose Head of Household.

We’re now ready to create the final formula in our table, which will perform the actual tax calculation. Enter this formula in cell D11:

=INDEX(A2:I8,MATCH(C11,A3:A8,0),MATCH(E11,A2:I2,0)+1)

In this case, we’re specifying the entire table range for the reference argument of the INDEX function, and then using two MATCH functions to return the row and column positions. This MATCH function determines the row for our tax rate:

MATCH(C11,A3:A8,0)

Notice the zero in the match type position, because we want to ensure an exact match on the tax rate. The second MATCH function determines which column has the base-tax amount:

MATCH(E11,A2:I2,0)+1

As before, we’re determining which column our filing status appears in within row 2, but then adding 1 to that amount, since the base tax amount is in the next column over.

We now need to calculate the marginal tax amount beyond the base tax. To do so, add this to the end of the formula in cell D11:

(B11-INDEX(A2:I8,MATCH(C11,A2:A8,0),MATCH(E11,A2:I2,0))+1)*C11

The INDEX function returns the tax tier associated with the tax rate, and this amount is subtracted from the taxable income. $1 is added to this amount to determine the precise marginal amount to be taxed, and then the amount in parenthesis is multiplied by the tax rate in cell C11. The complete formula is shown in Figure 6.

Tax calculator - Figure 6Figure 6:  The final piece of the calculator determines the tax due based on income level and filing status.

 

The views and opinions expressed in this column are those of the author and do not necessarily reflect the opinions of Microsoft.

 

This article first appeared Microsoft Professional Accountant's Network newsletter.

 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

       
       
       
       
       
       
       

 

 

 

 

 

Build a Dynamic Income Tax Calculator – Part 1 of 2

By David H. Ringstrom, CPA

 

Look-up formulas are one of Excel’s most powerful features. Instead of manually linking to a worksheet cell, such as =A2, a look-up formula allows you to provide a criteria, such as taxable income, and have the formula automatically return the proper tax rate. This enables you to quickly run through various scenarios with your clients by simply changing the taxable income value. However, income tax calculations in particular can become tricky, as your formula also needs to refer to one of four different tables. In part 1 of this two-part series I’ll explain how to use the VLOOKUP formula to cross-reference tax rates from a single table. I’ll then show you how to use Excel’s INDIRECT function make your VLOOKUP formula refer to the proper table based on your choice of filing status in an adjacent worksheet cell. Next month, in part 2 of this series, I’ll show you how to condense all four tables into one, and use the MATCH and INDEX functions instead of VLOOKUP.

Click here to download the accompanying Income Tax Calculator spreadsheet.

Understand VLOOKUP

As you might infer, VLOOKUP performs vertical look-ups, which means it looks at columnar ranges. A similar function, called HLOOKUP, looks across rows, but for this article I’ll only focus on VLOOKUP.  This is an ideal function to use when you need a formula to return a marginal tax rate, as shown in Figure 1. First, let’s discuss the VLOOKUP function, which has 4 arguments:

 

  • Lookup_Value: The value that you’re searching for within a table. For instance, this might be a contact’s name, a part number, or in Figure 1, an income tax rate.
  • Table_Array:  A range of two or more columns that comprises your data. For instance, in Figure 1, the tax brackets are in the first column, the marginal rate in the second column, and the base tax is in the third column.  VLOOKUP always looks for the Lookup_Value in the first column of the table array.
  •  Col_Index_Num: The column number within the Table_Array contains the data that you want to return. Using Figure 1 as an example, we’d specify 2 if we want the income tax rate, or 3 for the base tax.

Caution: VLOOKUP will return a #VALUE! error if you enter a number less than 1 for the Col_Index_Num. Further, VLOOKUP will return a #REF! error if you specify a number greater than the number of columns in the Table_Array.

  • Range_lookup: This optional argument enables you to specify between an approximate match or exact match:
    • Approximate match:  By default, VLOOKUP returns an approximate match, which means if it can’t find the Lookup_Value in the first column of the Table_Array then it returns the next largest value. You can either omit this argument, or enter TRUE to indicate that an approximate match is acceptable.

Trap: Approximate matches require the first column of the Table_Array be sorted in ascending order —otherwise VLOOKUP may return an incorrect value.

  • Exact Match: Specify FALSE for this argument if only an exact match is acceptable. VLOOKUP returns #N/A if it cannot find the Lookup_Value in the first column of the Table_Array.

Caution: VLOOKUP matches on the first instance of the Lookup_Value. Thus, if your value appears more than once in column A, VLOOKUP will only return the first instance.

 

Tax Calculator - Figure 1 Figure 1: We’ll use VLOOKUP to create a simple income tax calculator.

 

 

Marginal Tax Rate Look-Up

Now that you understand the inputs for VLOOKUP, let’s walk through an example:

  1. Enter the word Single into cell A1 of a blank worksheet.
  2. Enter these into cells A2 through C8 of a blank worksheet, as shown in Figure 1:

2008 Taxable Income

Marginal Rate

Base Tax

0.00

10%

0.00

8,026.00

15%

802.50

32,551.00

25%

4,481.25

78,851.00

28%

16,056.25

164,551.00

33%

40,052.25

  1. Enter the words Taxable Income in cell A10.
  2. Enter the words Tax Rate in cell B10.
  3. Enter a taxable income number in cell A11, such as 125,000.
  4. Enter this VLOOKUP formula cell B11:

=VLOOKUP(A11,A3:C8,2,TRUE)

                The arguments for the function are as follows:

  • A11 represents the Lookup_Value, which returns the taxable income amount
  • A3:C8 represents the Table_Array, or the coordinates of the tax table
  • 2 represents the Col_Index_Num, which indicates that we want the tax rate from the second column of the table
  • True represents the Range_Lookup, which indicates that we want an approximate match, or the closest tax bracket for the taxable income amount.

The formula in cell B11 should return 28% if you entered 125,000 in cell A11.

Shortcut: Since we’re not seeking an exact match, we can omit the Range_Lookup argument and shorten the formula to this:

=VLOOKUP(A11,A3:C8,2)

Conversely, our formula would look like this if we did want an exact match:

=VLOOKUP(A11,A3:C8,2,FALSE)

Tax Calculation

Our formula in cell B11 now determines the marginal tax rate, so now we’ll calculate the tax liability. We can see that income of $125,000 places our taxpayer in the 28% tax bracket. However, 28% doesn’t apply to every dollar of their income — only to income greater than $78,850. We’ll add the base tax of $16,056.25 to this calculated amount, for a total tax of $28,978.25. The formula to perform this calculation is somewhat complex, so we’ll build it in stages:

  1. Enter the words Tax Liability in cell C10.
  2. Enter this formula in cell C11:

=VLOOKUP(A11,A3:C8,1)

We specify 1 for the Col_Index_Num, so that we can return the starting point of our tax bracket. Based on income of $125,000, the formula should return $78,851.

  1. Modify the formula in cell C11 to look like this:

=A10-(VLOOKUP(A11,A3:C8,1)-1)

Your formula should now return $46,150. In this case we’re taking our taxable income of $125,000 from cell A11, subtracting the tax bracket of $78,851, and then subtracting $1 from that amount. This is because our client must pay tax of 28% of all income greater than $78,850.

  1. Modify the formula in cell C11 to look like this:

=(A11-(VLOOKUP(A11,A3:C8,1)-1))*B11

Your formula should now return $12,992, which is $46,150 multiplied by 28%.

  1. The last step is to add the base tax amount, which requires a second VLOOKUP. Modify the formula in cell C10 to look like this:

=(A11-(VLOOKUP(A11,A3:C8,1)-1))*B11+VLOOKUP(A11,A3:C8,3)

The formula should now return $28,978.25, as shown in Figure 2.

Tax Calculator - Figure 2Figure 2: The spreadsheet now calculates the tax liability.

 

 

Expand the Calculator

Since our formula works with a single table, we’ll now add the three additional tables to the spreadsheet. After that we’ll then assign range names to each table, add a filing status input, and then incorporate the INDIRECT function into our VLOOKUP formulas. Here’s how:

  1. Add the remaining three tables, as shown in Figure 3:

Married-Filing Jointly

2008 Taxable Income

Marginal Rate

Base Tax

0.00

10%

0.00

16,051.00

15%

1,605.00

65,101.00

25%

8,962.50

131,451.00

28%

25,550.00

200,301.00

33%

44,828.00

357,701.00

35%

96,770.00

 

Married-Filing Single

2008 Taxable Income

Marginal Rate

Base Tax

0.00

10%

0.00

8,026.00

15%

802.50

32,551.00

25%

4,481.25

65,726.00

28%

12,775.00

100,151.00

33%

22,414.00

178,851.00

35%

48,385.00

 

Head of Household

2008 Taxable Income

Marginal Rate

Base Tax

0.00

10%

0.00

11,451.00

15%

1,145.00

43,651.00

25%

5,975.00

112,651.00

28%

23,225.00

182,401.00

33%

42,755.00

357,701.00

35%

100,605.00

 

Tax Calculator - Figure 3Figure 3: Add the additional tables to your spreadsheet.

 

 

  1. The next step is to assign a range name to each table. This will allow us to refer to each table by name, such as Single, rather than by cell coordinates, such as A3:C8. To do so, select cells A3:C8, and then enter the word Single in the Name Box, as shown in Figure 5.

Tax Calculator - Figure 4Figure 4: You can use the Name Box to assign a range name to a cell or block of cells.

 

  1. Select cells E3:G8, and assign the name MarriedJoint
  2. Select cells I3:K8, and assign the name MarriedSingle.
  3. Select cells M3:O8, and assign the name HeadOfHousehold.

Name limitations: You cannot use spaces or dashes within range names, nor can you start a range name with a number. Many users use the underscore character in place of spaces, such as Head_of_Household.

  1. Enter the words Filing Status in cell D10.
  2. Use the Data Validation feature to create an in-cell drop-down list in cell D11:
  1. Excel 2007: Choose the Data Validation icon in the Data Tools section of the Data ribbon.

Excel 2003 or earlier: Choose Tools, and then Data Validation.

  1. In all versions of Excel, choose List, and then enter this into the Source field, as shown in Figure 5:

Single,MarriedJoint,MarriedSingle,HOH

Caution: Be sure that the contents of the Source field exactly match the range names that you assigned to each of the tables.

 

Tax Calculator - Figure 5
Figure 5:
Enter these settings in the Data Validation window.

 

 

  1. Click OK. At this point, a drop-down list should appear when you click on cell D11, as shown in Figure 6.

Tax Calculator - Figure 6
Figure 6: Data Validation provides an in-cell dropdown list.

 

  1. Modify the formula in cell B11 to use the INDIRECT function:

=VLOOKUP(A11,INDIRECT(D11),2)

Tip: You’re simply replacing A3:C8 with INDIRECT(D11).

  1. Modify the formula in cell C11 to use the INDIRECT function:

=(A11-(VLOOKUP(A11,INDIRECT(D11),1)-1))*B11+VLOOKUP(A11,INDIRECT(D11),3)

 

INDIRECT: The INDIRECT function enables you to convert text into an Excel address. In this case, we can use INDIRECT to change between one of four tables without having to modify the formulas in cells B11 and C11.

  1. At this point you can test your work by making different choices from the drop-down list in cell D11:
  • MarriedJoint should cause cell C11 to return $23,937.50
  • MarriedSingle should cause cell C11 to return $30,614.50
  • HOH should cause cell C11 to return $26,683.00

You now have a functional tax calculator that we’ll streamline next month in Part 2 of this series.

 

The views and opinions expressed in this column are those of the author and do not necessarily reflect theopinions of Microsoft.

 

 

This article first appeared Microsoft Professional Accountant's Network newsletter.

 

 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

 

 

 

How to Speed Up Microsoft Excel’s Help Window

By David Ringstrom, CPA
 
From time to time, you probably get stymied in Excel and think, “I'll just look in the help file.” Doing so is as simple as pressing F1 or clicking the question mark icon that appears in the upper right-hand corner of Excel 2007 and later. However, you might end up waiting several seconds for the help window to appear. In this article, I'll explain how you can eliminate this annoying wait that can break your stride.
 

 

 A previous version of this article first appeared on www.accountingweb.com .

 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

 

Maximizing Excel’s Recent Items Menu

 
By David Ringstrom, CPA
 
 

Depending upon your version of Excel, the Recent list on the File menu can streamline access to both files and folders. If you work on numerous spreadsheets, this list offers marginal value in Excel 2003 and earlier. The list gained some new functionality in Excel 2007, reached its zenith in Excel 2010, and fell back somewhat in Excel 2013. This list provides one-click access to between 4 and 25 files (and sometimes folders). As you'll see in this article, each version of Excel offers markedly different functionality with regard to accessing recent spreadsheets.
 
 
 

Continue reading this article  where it first appeared: www.accountingweb.com

 
 
About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link.

 

Converting a Digital Photo into an Excel Spreadsheet

By David Ringstrom, CPA

In an unlikely mash-up, Matt Parker of Think Maths offers a free tool that converts a digital photo of your choice into an Excel spreadsheet. According to the website, “digital photographs are actually just spreadsheets. When you take a photo, your camera measures the amount of red, green, and blue light hitting each pixel, ranks them on a scale of 0 to 255, and then records those values as a spreadsheet.” Parker's website is able to extract said values from a digital photo, record the numeric values in worksheet cells, and then use Excel's Conditional Formatting feature to recreate the photograph.

 

 

Continue reading where this article first appeared:  www.accountingweb.com .
 

 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link


 
 

How to Automate Text File Links in Microsoft Excel

By David Ringstrom, CPA
 

Some time ago, I explained how to use Excel's Text to Columns Wizard for separating text within a spreadsheet into columns. Although this approach is helpful for data that's in a spreadsheet, in other cases, you may wish to link spreadsheets to text files that change periodically. In this article, I'll walk you through the steps of automating this process.

 

Continue reading this article where it first appeared:  www.accountingweb.com .

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

How to Eliminate a Common Spreadsheet Design Flaw

By David Ringstrom, CPA
 

Data within Excel spreadsheets is commonly organized in columns, with explanatory titles at the top of each section. When carrying out this most basic of data entry tasks, many Excel users often unwittingly cause Excel to be harder to use. Whenever column headings within a worksheet span two or more rows, a cascade of issues can occur. Fortunately, a simple technique can help you avoid frustration and save time when working in Microsoft Excel.

 

  Continue reading this article where it first appeared: www.accountingweb.com .

 

 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

Three Ways to Convert Text-Based Numbers to Values

By David Ringstrom, CPA



Periodically, you may encounter numbers in Excel that you can't sum or use arithmetically. A common cause for this is numbers formatted as text. Often, reports exported from other programs, such as an accounting package, will be formatted as text or they might contain embedded spaces.

In this article, I'll describe three ways you can convert numbers that appear trapped under glass into a usable format.


First, there are a couple of ways to determine if your numbers are formatted as text. Select one or more of the suspect values and then in:
  • Excel 2007 and later or Excel:Mac 2011: Determine if the word Text appears on the Home tab, as shown in Figure 1.
  • Excel 2003 and earlier: Choose Format, Cells, and then determine if the Number tab is set to Text.
Figure 1: The Text format prevents you from using numbers with mathematical functions.


The Text format in a cell displays the contents of a worksheet cell rather than its result. Thus, if you enter a formula in a cell formatted as text, the underlying formula will appear in your worksheet cell rather than the result.


However, the Text format is not the only way to store values as text. If you look closely within a worksheet cell, you may see that a numeric value is prefaced with a single quote. This is another means to display the contents of a cell rather than the result.


You can categorically determine if a number is stored as text by way of the ISTEXT worksheet function. For instance, if cell A1 contains a value you think may be stored as text, type this formula in a nearby blank cell:
=ISTEXT(A1)
The ISTEXT function will return TRUE if the value in cell A1 is being stored as text, or FALSE if it isn't.


Now that we know how to determine if a number is stored as text, let's look at three ways to convert one or more cells back to numeric values:


One approach is to use the =VALUE function, as shown in Figure 2. If the cell that you reference with the VALUE formula can be converted to a numeric value, you'll see the corresponding number. Otherwise, you'll see a #VALUE! error, which signifies that the referenced cell contains letters or other non-numeric contents. You can then copy the VALUE formula as needed to convert additional values to numbers. Keep in mind that you'll then need to copy these formulas to the clipboard, and then use Paste Special, Values to preserve the numeric results. You might choose to replace the original set of numbers with the results from the VALUE formulas, after which you can clear the VALUE formulas from the spreadsheet.
Figure 2: You can use the VALUE function to convert numbers stored as text to usable values.


A somewhat simpler approach involves using the Paste Special, Multiply command. In any version of Excel, enter the number 1 in a blank cell and then copy that value to the clipboard. Next, select the range of values stored as text, right-click, and choose Paste Special, Multiply, and then OK. You can then clear 1 from the worksheet cell.
Figure 3: You can also convert numbers stored as text to values by multiplying the cells by 1.


The easiest way to convert a range of values to text, though, involves using the Text to Columns feature. In any version of Excel, select the range of cells that contain numbers stored as text, then choose Data, Text to Columns, and then click Finish. Don't select any choices within Text to Columns; simply launch the wizard and then click Finish, as shown in Figure 4. Your text-based numbers will be usable numbers in Excel.


Figure 4: The Text to Columns wizard is the easiest way to convert numbers stored as text to values.


A previous version of this article first appeared on www.accountingweb.com .
About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

Automating Data Validation Lists in Excel

By David Ringstrom, CPA



Working in an Excel spreadsheet can be somewhat like the Wild West  unless other provisions are made, users can enter any value in any cell. One way you can restrict users to a predefined set of values is by way of Excel's Data Validation feature. I'll explain how you can create in-cell drop-down lists, along with how to “future proof” the Data Validation list so that the feature won't require maintenance if you add additional items in the future. This technique also resolves an annoying problem in Excel 2007 where data validation lists cannot be placed on other worksheets.


Before we look at Data Validation, let's first establish our list. Let's say we want the user to choose a type of fruit. On the second worksheet of a blank workbook, create a list, such as shown in Figure 1. Once you do so, make the list into a Table in Excel 2007 and later, or a List in Excel 2003 and earlier. After you click on any cell within your list:
  • Excel 2007 and later  Choose Insert and then Table. Make sure that My Table Has Headers is selected and then click OK.
  • Excel:Mac 2011  On the Tables tab of the ribbon, click the arrow next to the New command and then choose Insert Table with Headers.
  • Excel 2003 and earlier  Choose Data, List, and then Create List.
Figure 1: Enter a few items on the second worksheet of a workbook.


A benefit of tables (and lists in Excel 2003 and earlier) is that if you add items to the bottom of the list, the table will expand automatically to encompass the new items. However, we can't use this self-expanding table or list directly with Data Validation. To do so, we must create a range name that encompasses all but the first row of the table. Select the second through last row of your range, and then:
  • Excel 2007 and later  On the Formulas tab choose Define Name.
  • Excel 2003 and earlier, or Excel  Mac 2011: Choose Insert, Name, and then Define.
Once the Define Name dialog box shown in Figure 2 appears, enter a name such as Fruit, ensure that the Refers to field references the second through last row of your table, and then click OK.
Figure 2: Assign a name to the second through last cell of your table or list.



Let's first take a look at the Data Validation feature. On the first worksheet of the workbook where you created your list, click on cell A1 and type the word Fruit. Next, select cell A2 and choose Data and then Data Validation. The dialog box in Figure 3 will appear. On the Settings tab, choose List in the Allow field. When the Source field appears, type an equal sign along with the range name that you assigned before, such as =Fruit.



[1]
Figure 3: Choose List and then specify your range name as the Source on the Settings Tab.



On the Input Message tab, enter a title, such as the word Fruit, to describe the input field, along with a message, such as “Choose an item from the list,” as shown in Figure 4. It's not necessary to use quotation marks in the Description field.
Figure 4: Although optional, the Input Message tab allows you to document the validation.



Finally, on the Error Alert tab, enter a Title, such as “Invalid Input,” and an Error Message, such as “You must make a selection from the list,” as shown in Figure 5. Keep the style set as Stop to prevent the user from bypassing the list items. Click OK to close the Data Validation dialog box.



Figure 5: Be sure to complete the Error Alert tab; otherwise, invalid inputs will trigger a generic and cryptic error prompt.



Going forward, when you click in cell A2, a note should appear as shown in Figure 6. This documents the spreadsheet. If the user makes a valid choice, he or she will then be able to move to another cell; otherwise, the prompt shown in Figure 7 will stop the user in his or her tracks.



Figure 6: Our choices on the Input tab yield a helpful prompt when the user clicks on cell A2.



Figure 7: The user will see this prompt if he or she tries to enter something that doesn't appear on the list.



Now, return to your original list, and add two more items, as shown in Figure 8. When you return to your cell with the Data Validation list, the new items should appear automatically. The combination of the table/list features and range names automates this aspect. Within the Data Validation dialog box, you can provide a specific set of cell coordinates in the Source field, but you would then need to manually change the setting if you later expanded the list. Further, Excel 2007 and earlier won't allow you to reference cell coordinates on other worksheets. Best practices in spreadsheet design call for separating supporting lists from the actual data on separate worksheets. Anyone using Excel 2007 and later is no longer faced with the struggle of where to safely position supporting lists for Data Validation on the same worksheet as the actual input is occurring.



Figure 8: Since the ultimate source for a validation list is a table/list, new items appear on the Data Validation list automatically.



A previous version of this article first appeared on www.accountingweb.com .




 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

Improving the Integrity of Excel’s SUM Function

By David Ringstrom, CPA

My unscientific observation is that the SUM function is the most widely used function within Excel spreadsheets. This function makes it easy to add up multiple cells at once without laboriously adding multiple cells together individually.

Taking things a step further, the AutoSum feature makes it easy to instantly add multiple totals into a spreadsheet. However, such ease of use actually introduces risk into Excel spreadsheets.

 

Let's say you need to total the values shown in Figure 1. Rather than manually add the SUM function to cells B4:G4 and H2:H4, you can use two keyboard shortcuts instead:
  • Click once on cell A1 and then press Ctrl-A. This will select the contiguous area, which we need to expand by one row and one column.
  • Hold down the Shift key, then tap the Down arrow, and then the Right arrow. At this point, your selection should look like Step 1 of Figure 1.
  • Press Alt-Equal Sign in Windows, or on a Mac, press Command-Shift-T. Alternatively, you can click the AutoSum icon, which looks like a Greek E. Any of these actions should add totals to row 4 and column H simultaneously. Do be sure to select the cells you wish to sum; otherwise, AutoSum will place a SUM function in the first numeric cell within the current region of your spreadsheet.

Figure 1: You can use AutoSum to add totals to the row below and column to the right if you expand the initial selection.


This technique added the necessary sums, but unfortunately, these formulas we so easily added are not future-proof, as shown in Figure 2. Here's how you can confirm this:
  • Insert a new row at row 4 so that the totals move down to row 5. Label cell A4 as Pears, and then enter 1000 in cells B4 through G4.
  • Notice how the totals in row 5 don't reflect the additional amount that was added for each month. 

Figure 2: The totals don't reflect the additional amount that has been added for each month. 


To correct this, we'd need to manually adjust the SUM formulas in row 5 to include rows 2 through 4, instead of rows 2 and 3. We'd then have to remember to carry out this action each time we add a new product line. Fortunately, a simple change to your spreadsheet design can liberate you from having to remember to adjust these formulas as shown in Figure 3:
  • Insert a blank row just above the total row, which in this case now appears on row 5. Change the row height to half of its normal height. An easy way to do so is to click on the row number on the worksheet frame and then drag the bottom of the row upward slightly. Next, adjust the SUM formulas in row 6 to be: =SUM(B1:B5).

Figure 3: Insert a blank row just above the total row to avoid adjusting the SUM formula each time a new item is added.


You'll notice that I included row 1 in the formula as well as the blank row 5. Going forward, if a user adds a new row, he or she will either enter it on or below row 2 or above row 5. Our SUM function will automatically encompass the additional row(s) without further interaction on our part. To improve the integrity of your spreadsheets, be sure your SUM formulas always sum one row above and one row below the actual numbers you're adding up.


A previous version of this article first appeared on www.accountingweb.com .
About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

Microsoft’s Chip In Program Offers Crowdfunded Laptops to Students

By David Ringstrom, CPA



Microsoft is dipping its corporate toe into the crowdfunding pool. An experimental program dubbedChip In allows students to tap friends and relatives in a quest to fund their next computer. The program will run through September 1, 2013, and offers a 10 percent discount on a selection of name-brand laptops, tablets, and all-in-one computers. Fleet-footed student funders can also score a free, four-year subscription to Office 365 University.

The Chip In program is limited to full- or part-time students in the United States with an .edu e-mail address. Employees of US educational institutions who have an .edu e-mail address can also participate in the program.


Participants start by selecting a laptop or tablet that costs as little as $359 or as much as $1,079. Prices reflect a 10 percent discount, or the amount that Microsoft is “chipping in” to get participants started.


Next, participants establish a profile by logging in with their Facebook account, and then the race is on to see which friends, relatives, and acquaintances are willing to “chip in.” The first 10,000 students to fully fund their purchase get a complimentary four-year subscription to Office 365 University, a $79 value.


There are a couple of Byzantine aspects to the program. Let's say you select the $359 ASUS X202e but only raise $300. In that case, all pledges will be returned; in effect, no one's credit card will be charged. But, if you select the $810 Lenovo Yoga and only raise $500, you can still apply that amount toward a less expensive computer, or you can “chip in” the remaining balance yourself. Specifically, participants must either (1) raise the entire amount of a computer priced less than $499, or (2) raise a minimum of $499 to be able to get a new laptop through this program.


Another catch is that one of the tablets, the Surface RT, uses an operating system incompatible with Office 365 University. Further, the FAQ section [3] of the program contains a hypothetical question about the ability to install Office 365 University on two devices, followed by the terse response: “We are not sharing any details about installation on mobile devices today.” Byzantine, indeed.


There are certainly at least a couple of upsides here for Microsoft. First, the program gets participants to use Windows 8 computers, as opposed to Mac OS or another operating system. Further, the free subscription to Office 365 gives students four years' use of the web-based Office applications. Once acclimated to this environment, they'll likely continue as paying subscribers, which furthers Microsoft's Cloud-migration and subscription-based revenue goals.


Office 365 [4] typically costs $99/year for home users and allows use of the web-based Office applications on any computer, and the desktop versions on up to five devices. Conversely, students can qualify for a discounted Office 365 University edition that runs $79 for four years. Just be sure not to ask questions about installing on mobile devices.


A previous version of this article first appeared on www.accountingweb.com .
About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

Resolving #VALUE! Errors in Microsoft Excel

By David Ringstrom, CPA

 



It's a frustrating experience when a simple Excel spreadsheet displays #VALUE! in a worksheet cell rather than the expected result. Many times the problem is obvious, in that you've tried to do arithmetic using text and numbers, but sometimes the culprit is harder to track down.


As shown in Figure 1, the formula =C2/A2 returns #VALUE! because I purposely mistyped the formula and attempted to divide the value 5000 in cell C2 by the word Apples in cell A2. The same error would have appeared if I were to try to divide cell A2 by C2, or add or subtract one of those cells from the other. With that said, I could sum cells A2 through C2, as in =SUM(A2:C2), and the result would be 5500 and not #VALUE.


Figure 1: Dividing a number by a cell that contains text will return a #VALUE! error.



Now, let's change the scenario a little and assume that in cell D2 we have the formula =C2/B2, but cell C2 is blank. In this case, Excel should return 0, but you may still encounter a #VALUE! error as shown in Figure 2. The reason is that cell C2 may not be truly blank. Users, either on purpose or unintentionally, erase values by tapping the spacebar. Insidiously, this makes it appear as if a cell is blank when in actuality it isn't. Before we explore this further, keep in mind that if cell B2 is blank but C2 contains a number, then the aforementioned =C2/B2 will return a #DIV/0! error, which signifies division by zero.
Figure 2: Although cell C2 looks blank in both examples, Excel returns a #VALUE! error if the cell isn't actually blank.



Sharp-eyed users can press F2 within a cell and then make note of where the blinking cursor is, as shown in Figure 3.  If the cursor is adjacent to the left border of the cell, the cell is most likely blank. However, if the cursor is a couple of millimeters to the right, then there's a space. To categorically check, click once on a cell, and then press the Delete key.
Figure 3: Zoomed-in view of individual worksheet cells contrasts empty vs. non-empty worksheet cells.



You can also use the ISBLANK worksheet function to determine whether a cell is blank or not. For instance, the formula =ISBLANK(C2) will return TRUE if cell C2 is blank or FALSE if it isn't.



Curiously, if you're doing simple arithmetic with cells that contain numbers stored as text, Excel will perform the calculation without issue. To try this out, type a single quote in cell B2, followed by a number such as 500 and then two spaces. In cell C2, enter a single quote followed by 5000 and two spaces. In cell D2, the formula =C2/B2 will return 10. Of course, if you were to try to sum the current values of cells B2 and C2, the SUM function would return 0, because worksheet functions don't generally convert text to numbers on the fly. Should you encounter numbers stored as text, the easiest solution is to use the Text to Columns wizard:
  • Select one or more cells in a single column, choose Text to Columns from the Data tab or menu, and then click Finish.
This technique only allows you to convert one column at a time. If you need to convert multiple columns:
  • Enter the number 1 in a blank worksheet cell and then copy it to the clipboard.
  • Select the range of cells you wish to convert to values and then right-click and choose Paste Special.
  • Double-click on Multiply.
This action will multiply all of the values by 1, which in turn also converts them to numeric values instead of text.



Regardless, there are other situations in Excel that can cause the #VALUE! error, such as a recalculating a linked reference to a closed workbook or including a text-based reference in a formula that's expecting a value, such as =SUM(“Apples”,5,500). The Microsoft website offers additional guidance [1] as well.



A previous version of this article first appeared on www.accountingweb.com .


About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

Overcome a Nuance of Excel’s Subtotal Feature

By David Ringstrom, CPA

Many users rely on the Subtotal feature in Excel to instantly insert totals, averages, counts, or other statistics into a list. As you'll see, the feature is easy to use – until you want to copy or format just the total rows. In this article, I'll explain the nuance so that you'll be in complete control of this feature.

Figure 1 shows a typical data set for use with the Subtotal feature. We can use the Subtotal feature to insert a total after each product as well as a grand total at the bottom. As an added benefit, we'll then be able to expand and collapse our list by way of outlining buttons that will appear at the left. To do so:
  1. Select any cell within your list.
  2. Choose the Subtotal command on the Data tab in Excel 2007 and later, or the Data menu in Excel 2003 and earlier.
  3. Select the Cases Sold field, and then click OK.
Figure 1: Use the Subtotal feature to automate inserting totals within a list of data.


Figure 2 shows the newly inserted subtotals, along with outlining controls at the left-hand side of the worksheet. If you click the 1 button, the list will collapse down to just the total rows, as shown in Figure 3.
Figure 2: The Subtotal feature inserted a total after each change in the Product column.


Figure 3: Click the 1 button to collapse the list down to just the total rows.


Click on cell A1 and then press Ctrl-A to select the contiguous block of data. Press Ctrl-C to copy, and then in a new worksheet, press the Enter key to paste your data. At this point the aforementioned nuance reveals itself. One would think Excel would copy and paste just the visible rows that contain the totals, but instead, Excel includes all of the rows, as shown in Figure 4. 
Figure 4: Even though we thought we copied just the total rows, Excel pasted all of the rows.


Similarly, any formatting that you apply would affect the hidden rows as well. Here's how to take charge of the situation:
  1. As shown in Figure 5, select the cells that you wish to copy or format.
  2. Press Ctrl-G to display the Go To dialog box and then click the Special button.
  3. Double-click Visible Cells Only.
Figure 5: Use the Go To Special command to select just the visible rows for copying or formatting.


At this point, you can copy or format just the total rows. You can access the Go To Special command in other ways as well:
  • In any version of Excel, press F5 instead of Ctrl-G.
  • In Excel 2007 and later, choose the Find & Select command on the Home Tab and then choose Go To Special.
  • In Excel 2003 and earlier, choose Edit, Go To, and then click the Special button.
N.B.: You don't need to use the Go To Special command with filtered lists (the Filter command in Excel 2007 and later, or the AutoFilter command in Excel 2003 and earlier). Only the visible rows are affected when you copy or format filtered lists, but with the Subtotal feature, the extra step of Visible Cells Only will help you keep your sanity.


A previous version of this article first appeared on www.accountingweb.com .

 

About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link

Farewell, Lotus 1-2-3

By David Ringstrom, CPA



 

IBM recently announced that Lotus 1-2-3 will no longer be available for purchase. Most readers of this article will likely have one of two reactions: “What is Lotus 1-2-3?” or else an incredulous “Lotus 1-2-3 was still on the market?” If you're of a certain age, you may wistfully remember Lotus 1-2-3 as your first spreadsheet program.

Lotus 1-2-3 has had a suggested retail price of $352, but it soon will no longer be available for purchase. Although it wasn't the first spreadsheet – VisiCalc has that distinction – Lotus 1-2-3 owned the spreadsheet for a number of years. Although Lotus did outlast Quattro Pro, Microsoft Excel eventually won the spreadsheet wars.


Lotus was slow to innovate and clung valiantly to its DOS-based heritage by way of feeble desktop publishing efforts like WYSIWYG. That wacky acronym stood for “What You See Is What You Get” with regard to applying fonts, colors, and other formatting to data and getting the same output on paper as one saw on-screen. If you want a sense of how spreadsheets looked “back-in-the-day,” you can download and run VisiCalc.


Lotus 1-2-3 was first released in 1983, so its discontinuance this year marks the end of a thirty-year run. IBM bought Lotus Corporation in 1995 and still sells Lotus Notes, among other offerings, but will soon be dropping the Lotus name entirely. Lotus Corporation had a storied past, including innovative spreadsheet alternatives such as Improv and Symphony that never gained traction in the marketplace.


IBM will still provide support for Lotus 1-2-3 until June 2014, so die-hard users have a bereavement period during which they can transition their spreadsheet affairs to Apple's Numbers, Google Docs, OpenOffice, or perhaps even Microsoft Excel.


A previous version of this article first appeared on www.accountingweb.com .



About the author:

David H. Ringstrom, CPA heads up Accounting Advisors, Inc., an Atlanta-based software and database consulting firm providing training and consulting services nationwide. Contact David at david@acctadv.com  or follow him on Twitter. David speaks at conferences about Microsoft Excel, and presents webcasts for several CPE providers, including AccountingWEB partner CPE Link