Business Math/Excel UnitChapter 1 Basic Math and Excel FunctionsStudent Notes

Note to Students: The study of business math is a practical approach to learning math. In studying business math, you learn basic math skills that will be useful throughout your life. Checking a sales slip, balancing a checking account, and understanding the various ways interest is charged on loans are just a few of the many practical skills you will learn in this unit.

1.1 THE NUMBER SYSTEM

The decimal number system is a number system based on 10. A dot (.) which is called a decimal point separates whole numbers from decimal numbers.

Objective 1: Identify each position of the decimal number system

Objective 2: Write numbers or amounts in word forms

Numbers or amount may be written using numerals or spelled out in word forms. When amounts are written in word forms, the decimal point is represented by the word and.

Numbers / Word Forms
3 / Three
28 / Twenty-eight
39.06 / Thirty-nine and six hundredths
837 / Eight hundred thirty-seven
4,169 / Four thousand one hundred sixty-nine
72.1 / Seventy-two and one tenth
283.512 / Two hundred eight-three and five hundred twelve thousandths

A common use for word form is in writing checks. The bank requires you to write the amount in both number and word forms as shown below. Notice that the fraction of a dollar 50/100 is written as a fraction along with the word form.

Objective 3: Round numbers to approximate an answer

Occasionally it is helpful to come near to, or to approximate an amount rather than give an exact amount.

Examples:

VCR and two movie videos cost $219.95, or approximately $220. / VCR and two movie videos cost $219.05, or approximately $219.

Objective 4: Round Numbers

If you understand approximation and positions (places), you will more easily understand rounding numbers. Here are the rules for rounding numbers.

Step 1 Determine the position (place) being rounded.
Step 2 If the digit to the right of the position (place) is 5 or more, round up by 1.
Step 3 If the digit to the right of the position is less than 5, do not round up. Drop all digits from that position to the right. Example: 6.4 rounds to 6 (4 is less than 5).

Examples:

5.35 / Rounded to the nearest tenth is 5.4 / 5 is equal to 5
0.981 / Rounded to the nearest hundredth is 0.98 / 1 is less than 5
0.99 / Rounded to the nearest tenth is 1.0 / 9 is more than 5
0.09 / Rounded to the nearest tenth is 0.1 / 9 is more than 5
358.8549 / Rounded to the nearest thousandth is 358.855 / 9 is more than 5
2976.8 / Rounded to the nearest hundred is 3000 / 7 is more than 5

Objective 5: Use Excel to round numbers

Because it is highly likely that you will be using Excel on the job to complete many math calculations, you will find the program provides shortcuts that make calculations quick and easy. In this part of the lesson you will use three of Excel’s features to round numbers - - Increase and Decrease Decimal buttons, the Currency Style button, and the Format Cells command. Using these short-cuts will increase your proficiency and accuracy in math by letting Excel do the work for you.

Let’s practice together: Open the file ch01pr01 from the P:drive. Wait for teacher directions and complete the exercises as a class.

1.2 Addition Using Excel

Probably the most common math procedure used in Excel is addition. Therefore, Excel offers an AutoSum shortcut that makes adding quick and easy. You can also create your own formula (called a function) to add certain cells together.

Objective 1: Use Excel to solve problems involving addition

You will be learning three ways to add columns of numbers in Excel.

1.  Using AutoSum: The AutoSum button [S] is located in the Editing section of the Home ribbon. It is used to add quickly an entire column or row of numbers.

2.  Using the Keyboard to Enter an Addition Formula: The equals (=) key is an important part of a formula in Excel. The equal sign alerts Excel that you are entering a formula, not text. You can also start a formula with a plus sign (+) or a minus sign (-). If you do not begin your formula with one of these symbols, Excel will assume you are entering text and will not calculate the results. Below is an example of the same Excel formula for adding numbers in three cells written several ways.

=A5+A6+A7 This formula was created using the keyboard
+A5+A6+A7 This formula begins with a plus sign
-A5+A6+A7 This formula begins with a minus sign

3.  Using the Pointing Method to Enter an Addition Formula: A quicker method that eliminates the possibility of keyboarding errors is to enter the formula and use the mouse to point to the cells (called the Pointing Method) that should be added.

Let’s practice together: Open the files ch01pr02, ch01pr03 , and ch01pr04 from the P:drive. Wait for teacher directions and complete the exercises as a class.

1.3 Subtraction Using Excel

Subtraction, like addition, is a basic math skill used in business. Determining the balance in your checking account or how much money you have left after buying something are just two ways subtraction is used in your everyday life.

A negative number, or a credit balance, results when you subtract a larger number from a smaller number. Negative numbers are often expressed by enclosing the number within parentheses (29) or angle brackets {29}, expressed with a minus sign before the number, or printed in red.

Objective 1: Use Excel to solve problems involving subtraction.

In Excel, you may enter formulas for subtraction using the keyboard or the pointing methods (as described in your notes for addition). The hyphen on the keyboard represents the minus sign for subtraction.

Let’s practice together: Open the file ch01pr05 from the P:drive. Wait for teacher directions and complete the exercises as a class.

1.4 Multiplication Using Excel

Multiplication is one of the basic math concepts that will enable you to calculate more quickly. It is a shortcut for repeated addition. Multiplication is the mathematical procedure for finding the product of two numbers. One of the uses of multiplication is determining the total amount owed when you purchase more than one item costing the same amount, such as 6 blank videocassettes at $9.95 each. You can add $9.95 six times, but it is quicker to multiply $9.95 by 6.

Objective 1: Use Excel to solve problems involving multiplication

Formulas using multiplication are real time-savers that provide many helpful calculations, such as calculating payroll, sales tax, and invoice amounts. Just as you created formulas for addition and subtraction, you can create formulas for multiplication using the keyboard or the Pointing Method. The asterisk (*) is the operator that signals Excel to multiply. Here is an example of a formula that contains a multiplication operation: =B6*C6

Let’s practice together: Open the file ch01pr06 from the P:drive. Wait for teacher directions and complete the exercises as a class.

1.5 Division Using Excel

Division, like multiplication, is one of the basic math concepts that will enable you to calculate more rapidly. In your everyday life, you might use division to average your grade in this course or to split a sandwich to share with a friend at lunch. Division is the process of determining how many times one number is contained in another.

Objective 1: Use Excel to solve problems involving division

Creating a formula in Excel using division is similar to the other formulas you created except you use the slash symbol (/) to alert Excel when you want to divide.

Here is an example of a formula using division: =C11/B10

Let’s practice together: Open the file ch01pr07 from the P:drive. Wait for teacher directions and complete the exercises as a class.

1.6 Basic Math Operations Using Excel

Objective 1: Combine basic math operations in Excel

Often you may use several formulas that use the basic math operations in one spreadsheet to complete the desired calculations. You may also find that you create a multimath formula that includes more than one of the basic math operations you have learned. The following is such as formula: =1.5*(B8+C8).

This formula calculates overtime in a payroll problem, multiplying 1.5 times the overtime hours times the hourly rate. The 1.5 represents time-and-one-half, and the cells represent the number of overtime hours the person has worked and the hourly rate. The parentheses tell Excel to multiply the numbers in the cells before multiplying them by 1.5. Look at the spreadsheet below:

You must first understand how to calculate gross earnings on paper before you can begin to create the formula for it. The following display shows the order in which the computations are to be done.

(Hourly Rate*Regular Hours) + (1.5 * Hourly Rate * Overtime Hours)

Let’s practice together: Open the file ch01pr08 from the P:drive. Wait for teacher directions and complete the exercises as a class.