Companies do to keep an eye on their daily operational overheads. This is routinely done using various excel tools. A number of such tools include; MIN and Max statements, conditional formatting, relative referencing and absolute referencing. Take an example of a manufacturing concern that utilizes casual labour, for instance. The company accountant wouldn’t have a way of knowing the exact number of workers hired, but using the MAX statement, he would be able to define the extreme range of the cell.
In this way he is able to tell if the number input is expected or not. Basically, these two statements are used to make conspicuous cells that appear to be in extreme ranges (Blattner, 2001). The MIN statement could also be used in retail outlets to identify product lines that have lower than expected turnover or sales. This helps the shop manager to know which product lines need special attention in terms of advertising, training of staff etc, in order to boost the general bottom-line of the entire outlet.
A MAX statement can also be used to pin point areas (for example, transportation) that are incurring more expenses, so as to either identify ways of cutting back on the expenses or getting rid of such an area (may be through outsourcing ), especially if it is not primary to the business (Clauss, 2009). Businesses generally operate with targets. It wouldn’t be easy to know whether, a business concern is meeting its targets just by looking at the profit or sales columns in a spreadsheet. Conditional formatting would come in handy, easily marking out specific targets that have not been achieved.
For example in the total sales cell, you can conditionally format the cell to lime green if the Sales figure is greater than 500,000. Just by scanning through the spreadsheet, the lime green colour, would call your attention to the fact that the total accrued sales are over 500,000 (Blattner, 2001). Absolute referencing is a referencing style that does not change when copied to other cells. Absolute referencing is written thus, $A$1. It is used in computing constant value that do not change, e. g. commissions for sales persons. Relative referencing changes the formula depending on the cell reference.
It is used to calculate for values are changing (Retrieved from < http://www. auditexcel. co. za/et-06-Free-Online-Excel-Training. html>). References: Blattner P. , (2001). Special edition using Microsoft Excel 2002, Que Publishing, p 241-242 Clauss J. F. , (2009). Corporate Financial Analysis with Microsoft Excel, McGraw Hill Professional, p 170-173 Miracle Solutions, Free Online Excel Training For Your Company’s Benefits, retrieved from < http://www. auditexcel. co. za/et-06-Free-Online-Excel-Training. html on the 14th August 2010 at 13:52.