Spreadsheet in Accounting

ACCA F2 - Management Accounting

Excel is commonly used spreadsheet program. Spreadsheet is a sheet of paper with grid. The boxes in the grid are called cells. Horizontal lines of cells are called rows. Vertical lines of cells are called columns. A cell represent specific position in row and column. Data (mostly in form of numbers) are fed into a cell.

Learning excel starts from knowing the interface of excel program. User interface in Excel 2007/2013 is similar. It consists of quick access toolbar, ribbon, tabs, office button, formula bar, scroll bar, worksheet, sheet tabs and so on. User can customize the items in the interface to meet their need.

Formula ribbon in excel 2007, 2010, 2013 contains formulas divided into different classes like: financial, logical, text, date, time, lookup, reference, math, statistic and trigonometry. Formula bar is used to enter inputs for selected formula. Help function is quite handy when using formula. Once inputs are entered into formula user can easily recheck formula by tracing dependents and precedents. Excel is handy to use simple to complex formulas.

The option for visual representation of data in the form of pivot table and graphs is also available in Excel. Graphs are handy tools to present big data sets in small space. Selecting the right graph for presenting and delivering information to related party can be a difficult task. But, right chart is identified, it fits desired sets of available organized data and present it in a form of non-verbal information. A graph can replace paragraphs/pages of interpretation of the data and summarize the data in a pictorial format.

Spreadsheet is a powerful tool. It saves managerial time, is economic, flexible (handles diverse set of data), provide accurate calculation and facilitates data modeling.

Use of spreadsheet

What if

Budgeting and forecasting

Reporting performance

Variance analysis

Inventory valuation

Iteration

Spreadsheets generally do not offer the ability to structure and label data items as fully as a database and usually do not offer the ability to query the database.