An Excel Function is a instruction to excel to perform some built in task or

calculation.

E.g. The function SUM(A1:A10) tells Excel to sum up all the values in cells A1, down
to A10 and put the result in the cell where you typed it.

A formula is an expression that produces a result and may include functions.

E.g. A1+A2 tells Excel to sum the values in cells A1 and A2 only.
Another example of a formula is A1+SUM(A2:A10)

Both formulas and functions must be preceded by the equals sign for Excel to
understand them.
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A formula is statement written by the user to be calculated. Formulas can be as

simple or as complex as the user wants. A formula can contain values, references to
cells, defined names, and functions.

All formulas must start with the equals sign.

=1+2+3

A function is a piece of code designed to calculate specific values and are used
inside formulas. Functions to sum values, calculate a trigonometric cosine, and to
calculate the current time are built into excel. Additional functions can be defined
using Visual Basic.

Functions are typed alongside parenthesizes, where in the arguments if any are
listed in between. To use functions in a formula, for example

=COS(3.14) will return the calculated cosine.

=NOW() returns the current time.
=SUM(1+2+3) *2 will multiply the sum by 2

So, what is the difference exactly?

A function is something provided by Excel, such as IF, COUNT, SUM, AVERAGE and
so on, which will carry out an operation of some kind and provide an output value.
In most cases functions will take criteria, but not always (such as the RAND()
function, for example.

A formula also provides an output, but the main difference is that a formula is
something that is user-created, and can use within it many (or no) other Excel
functions to produce an output.

Look at the examples below:-

=A2+B2
=IF(A2=5,"YES","NO")
=sum(A2:A6)/10

All of these are formulas. As you can see, they can contain other functions and
operators (such as plus, minus, etc) to provide their output.

And that's it - It's really that simple. I hope this helps you to understand the
difference between the two.

Whats the difference between a formula and a function in Excel?

A function is a built in set of executable codes to perform a specific task. For

example, the Sum() function will add a group of numbers within the range specified
in the parenthesis. But what if you want to add half the numbers, then add the other
half , and multiply the two sums together. There is no prebuilt function in Excel to do
that. You need to write a formula.

A formula is a set of commands to generate a specific result. The commands may

include functions. For example, I could write a simple formula:
=sum(a1:a12)*sum(b1:b12). This formula combines the Sum function with the
multiplication operator to create the formula,

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A function is a predefined operation, like SUM or AVG.

A formula is made up of references and functions that you define, like:

=SUM(A1:B2), or =AVG(A1:A5)

What’s the difference between a Formula and a Function in Excel?

26 May, 2009

Ever been guilty of using Excel as a fancy calculator? If so, you’d be just using a
formula in Excel - such as =A1+A2 or =452*12.

There are, however, pre-defined formulas in Excel such as IF, SUM, VLOOKUP, INDEX
(and about 300 more!) These are referred to as functions.

So, you could write a formula containing a function eg. =MAX(A1:B20) or you could
just write a simple formula which does not contain a function eg. =A1/A2.

Mastering the use of functions in formulas is a key skill in learning Financial

Modelling. Happy formula-writing!

For a great discussion on writing formulas, see:

http://www.finance30.com/forum/topics/creating-an-excel-formula-the . You’ll
probably need to become a member of the Finance 3.0 website to view the
discussion, but it’s well worth it, as the website is a very useful resource for
Financial Modellers.