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Chapter 3. Building Basic Formulas > Understanding Formula Basics

Understanding Formula Basics

Most worksheets are created to provide answers to specific questions: What is the company's profit? Are expenses over or under budget, and by how much? What is the future value of an investment? How big will an employee bonus be this year? You can answer these questions, and an infinite variety of others, by using Excel formulas.

All Excel formulas have the same general structure: an equals sign (=) followed by one or more operands—which can be a value, a cell reference, a range, a range name, or a function name—separated by one or more operators—the symbols that combine the operands in some way, such as the plus sign (+) and the greater-than sign (>). Although it's unlikely that you'll ever reach it, the maximum number of characters that Excel allows within a single formula is 1,024.

NOTE

Excel won't object if you use spaces between operators and operands in your formulas. This is actually a good practice to get into because separating the elements of a formula in this way can make them much easier to read. Note, too, that Excel also accepts line breaks in formulas. This is handy if you have a very long formula because it enables you to “break up” the formula so that it appears on multiple lines. To create a line break within a formula, press Alt+Enter.


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