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Financial Modeling
Key Excel Functions
This sections walks you through important excel functions that are frequently used in financial
modeling. Its important to try these out in excel.
Financial Modeling
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Excel Functions
What are Excel Functions ?
Excel Functions are built-in formulas based on predefined logic that
makes it easy to calculate the output for a given data.
How to insert a Function?
Click Formulas tab in
Excel.
Within the Formulas tab
click Insert Function.
The dialog box shown on
the right would appear on
the screen.
Desired function type can
be selected from the drop
down list.
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Excel Functions-Example
Find the total sales of the following particulars using excel:
Particulars Sales
Iron Rods 105288
Iron Gurders 452278
Steel Sheets 265887
Iron Plates 248566
Total 1072019
How to insert a Function?
Click Formulas tab in Excel.
Within the Formulas tab click
Insert Function.
In the dialog box select Sum
function.
Insert the numbers to be
added in the text box of the
sum dialog box.
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Find the total sales of the following particulars using excel:
Insert the cell references
whose numbers is to be
added.
Excel Functions-Example
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Excel Functions
Excel Functions Functions types used in Financial Modeling
Excel
Functions
Financial
Date &
Timing
Logical
Lookup &
Reference
Math &
Trig
Statistical
Text
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Excel Functions
o Lookup & References
Choose
Offset
Lookup
VLookup
HLookup
Match
o Sum
Sum
Sumif
Sumifs
Sumproduct
Average
Averageifs
o Count
Count
Countif
Countifs
Counta
CountBlank
o If statement & its
alternative
If
And
Or
Max
Min
Commonly used Functions in Financial Modeling
o Dates
Year
Month
Day
Date
Date360
Edate
o Financial
PV
FV
PMT
Rate
NPER
IPMT
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Excel Functions
Lookup and References
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Excel Functions
Sum functions
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Excel Functions
Count functions
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Excel Functions
If statement and its Alternatives
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Excel Functions
Financial Functions
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CHOOSE Function:
Find the sales of the particular - Iron Rods:
OFFSET Function:
Find the sales of the fourth particular:
Formula:
=CHOOSE(2,C2,C2:C5)
Understanding of formula:
2nd figure from C2 from the range
C3:C5.
Excel Functions
Formula:
=OFFSET(B1,4,1,1,1)
Understanding of formula:
In column B, get the value of particular in 4
th
row and 1
column from B.
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Lookup Function:
Find the sales of the Steel Sheets:
Match Function:
Find the sales less than 150000:
Formula:
=LOOKUP("Steel Sheets",B2:B5,C2:C5)
Understanding of formula:
Looks up Steel Sheets in column B, and returns the value
from column C that's in the same row (265887).
Excel Functions
Formula:
=MATCH(150000,C2:C5,1)
Understanding of formula:
In column C, get the row whose value is less than 150000.
Output:
1
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Formula:
Understanding of formula:
Looks for the sales value of fifth row i.e. for Iron Plates.
Excel Functions
HLookup Function:
Find the sales value of the fifth row:
VLookup Function:
Find the sales values of Iron Plates:
Formula:
=VLOOKUP(B5,B1:C5,2,FALSE)
Understanding of formula:
Looks up Sales value of Iron Plates in column C, from the
range of particulars and sales.
=HLOOKUP(C1,B1:C5,5,FALSE)
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Formula:
Understanding of formula:
Add the numbers in the range
Excel Functions
Sum Function:
Find the sum of sales value:
SumIf Function:
Find the sum of sales value if sales is > 250000:
Formula:
Understanding of formula:
Adds Sales of Iron gurders and Steel Sheets as there sales
value is > than 250000. Output is 718165.
=SUM(C2:C5)
=SUMIF(C2:C5,">250000",C2:C5)
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Sumifs Function:
Find the sum of sales value:
SumProduct Function:
Find the profit :
Formula:
Understanding of formula:
Adds Sales of Steel Sheets and Iron Plate as there sales
value is > 150000 and < than 270000. Output is 514453.
Excel Functions
Formula:
Understanding of formula:
Multiplies value of column C with value of column D
respectively and add them.
=SUMIFS(C2:C5,C2:C5,">150000",C2:C5,"<270000")
=SUMPRODUCT(B2:B5,C2:C5)
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Average Function:
Find the Average of sales value:
Averageifs Function:
Find the profit :
Formula:
=AVERAGE(B2:B5)
Understanding of formula:
Averages the data in range.
Excel Functions
Formula:
=AVERAGEIFS(B2:B5,B2:B5,">150000",B2:B5,"<270000")
Understanding of formula:
Averages the data in range where sales value is > 150000
and < than 270000.
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Count Function:
Find the number of particulars:
CountIf Function:
Find the number of particulars where sales is > 150000:
Formula:
=COUNT(B2:B5)
Understanding of formula:
Counts number cells containing non-zero numbers in the
range.
Excel Functions
Formula:
=COUNTIF(B2:B5,">150000")
Understanding of formula:
Counts number of particulars whose sales value is > 150000
in the range.
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CountIfs Function:
Find the number of particulars where sales is > 150000 and <
270000:
CountA Function:
Counts number of cells that are not empty.
Formula:
=COUNTIFS(B2:B5,">150000",B2:B5,"<270000")
Understanding of formula:
Counts number of particulars whose sales value is >
150000 and < 270000 in the range.
Excel Functions
Formula:
=COUNTA(B2:B5)
Understanding of formula:
Counts number of sales value that are not empty in the
range.
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IF Function:
Find whether sales is > or < than 150000:
Max Function:
Find the maximum sales value:
Formula:
=IF(B2>150000,"Sales > than 150000","Sales < than 150000")
Understanding of formula:
Checks whether sales of Iron Rods is > or < than 150000.
Excel Functions
Formula:
=MAX(B2:B5)
Understanding of formula:
Gets the maximum value among the range.
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Min Function:
Find the minimum sales value:
PV Function: PV(rate,nper,pmt,fv,type)
Find the PV of insurance premium paid where premium is 1000,
risk free rate is 10% and time is 5 years:
Formula:
=MIN(B2:B5)
Understanding of formula:
Gets the minimum value among the range.
Excel Functions
Formula:
=PV(B3,B4,-B2,0,0)
Output:
3,790.79
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FV Function: FV(rate,nper,pmt,pv,type)
Find the FV of insurance premium paid where premium is 1000,
risk free rate is 10% and time is 5 years:
PMT Function: PMT(rate,nper,pv,fv,type)
Find the amount to be invested every year to get an amount of
6105.10 at the end of 5 years and risk free rate is 10%:
Excel Functions
Formula:
=FV(B3,B4,-B2,0,0)
Output:
6,105.10
Formula:
=PMT(B3,B4,0,-B2,0)
Output:
1000
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NPER Function: NPER(rate, pmt, pv, fv, type)
Find the number of years of investment to get 6105.10 by making
a payment of 1000 annually and risk free rate is 10%:
RATE Function: RATE(nper,pmt,pv,fv,type,guess)
Find the investment rate at which 1000 invested annually for 5
years would yield 6105.10:
Excel Functions
Formula:
=NPER(B3,-B4,0,B2,0)
Output:
5
Formula:
=RATE(B3,-B4,0,B2,0,0)
Output:
10%
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