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What is Microsoft Excel and What Does It Do?

This versatile program helps you make sense of your data

Microsoft Excel is a spreadsheet program used to store, organize, and manipulate data.

Microsoft Excel logo on a laptop screen
Microsoft Excel

Excel is a spreadsheet-based software program developed by Microsoft that allows users to organize, format, and calculate data using formulas.

This software is part of the Microsoft Office suite and is compatible with other Office applications. Like other Microsoft Office applications, Microsoft Excel can be purchased in the cloud with a subscription through Microsoft 365.

Note: The information we have compiled applies to Microsoft Excel and is not specific to any particular program version.

Why Do People Use Excel?

There are numerous reasons people use Excel. For example, someone may keep track of their expenses using Excel and a spreadsheet.

What Microsoft Excel Is Used For

Initially, electronic spreadsheet programs were based on paper spreadsheets used for accounting. As a result, the basic layout of computerized spreadsheets is the same as that of paper spreadsheets. Data gets stored in tables — which are collections of small rectangular boxes or cells organized into rows and columns.

Excel and other spreadsheet programs can store multiple spreadsheet pages in a single computer file in all versions. The saved computer file is known as a workbook, and each page in the workbook is a separate worksheet.

Spreadsheet Cells and Cell References

Excel spreadsheet with rows and columns highlighted

When you look at the Excel screen — or any other spreadsheet screen — you will notice a rectangular table or grid of rows and columns.

Each worksheet in newer versions of Excel contains roughly a million rows and more than 16,000 columns, necessitating an addressing scheme to track where data gets stored.

Numbers identify the horizontal rows (1, 2, 3) and the vertical columns by alphabetical letters (A, B, C). Columns with more than 26 are identified by two or more letters, such as AA, AB, AC or AAA, AAB, etc.

The small rectangular box known as a cell is where a column and a row intersect. The cell is the fundamental unit for storing data in a worksheet, and because each worksheet contains millions of them, you can identify each one by its cell reference.

A cell reference combines the column letter and the row number, for example, A3, B6, and AA345. The column letter is always listed first in these cell references.

Data Types, Formulas, and Functions

Microsoft Excel Formulas and Functions

The types of data that a cell can contain include:

  • Numbers
  • Text
  • Dates and times
  • Boolean values
  • Formulas

You can use formulas for calculations, usually including data from other cells. On the other hand, these cells could be on different worksheets or in different workbooks.

Enter the equal sign in the cell where you want the answer displayed. Formulas can also contain cell references to data locations and one or more spreadsheet functions.

Functions in Excel and other electronic spreadsheets are built-in formulas designed to simplify a wide range of calculations – from simple operations like entering the date or time to more complex ones like finding specific information in large tables of data.

Excel and Financial Data

Microsoft Excel spreadsheet with financial data

You can frequently use spreadsheets to store financial information. You can use the following formulas and functions on this type of data:

  • Performing fundamental mathematical operations such as adding columns or rows of numbers
  • Identifying values such as profit and loss
  • Calculating loan or mortgage repayment schedules
  • Identifying the average, maximum, minimum, and other statistical values in a given data set.
  • Conducting What-If analysis on data, in which variables are changed one at a time to see how the change affects other data, such as expenses and profits

Other Uses of Excel

Microsoft Excel chart

You can also use Excel to do the following tasks:

  • Data graphing or charting to aid users in identifying data trends
  • Data formatting to make important information easier to find and understand
  • To print data and charts for use in reports
  • Data sorting and filtering to find specific information
  • Creating links between worksheet data and charts for use in other programs such as Microsoft PowerPoint and Word
  • Data import from database programs for analysis

Spreadsheets were the first “killer apps” for personal computers because they could compile and interpret data. Early spreadsheet programs like VisiCalc and Lotus 1-2-3 were primarily responsible for the rise in popularity of computers like the Apple II and IBM PC as business tools.

Where Do You Find or Start Excel?

You can find Excel in the Windows Start menu if you have Excel or the entire Microsoft Office package installed on your Windows computer.

On Windows 10

Excel on Windows 10 start menu

On Windows 11

Excel on Windows 11 start menu

Keep in mind that most new computers do not come with Excel. Before you can use it on your computer, you must first purchase and install it. If you do not want (or cannot afford) to buy Excel, a limited version is available on the Microsoft Office website.

If Excel is installed on your computer but isn’t visible in the Start menu, use the steps below to launch it manually.

1. Open My Computer or File Explorer.

2. Select the C: drive. Select that drive instead if you have installed Microsoft Office on a drive other than the C: drive.

3. Locate the Program Files (x86) or Program Files folder and double-click on it.

4. Find and Open the Microsoft Office folder.

5. In the Microsoft Office folder, click the root folder. Then open the OfficeXX folder, where XX is the version of Office (e.g., Office21 for Microsoft Office 2021) installed on your computer.

Note: If there is no root folder, find and open the folder with Office in the folder name.

6. Locate and double-click the file named EXCEL.EXE to start the Excel program.

How to open Microsoft Excel without using a mouse

  1. To start, press the Windows key.
  2. Type Excel in the “Type here to search” and select the Microsoft Excel entry.
  3. If Microsoft Excel does not open after selecting it, press Enter to open it.

Excel Alternatives

Microsoft Excel spreadsheet and graph

Other spreadsheet programs that are currently available for use include:

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