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GEM2508
Frederick H. Willeboordse
frederik@chaos.nus.edu.sg
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Lecture 1
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Todays Lecture
Excel Basics
Understand the elements of the
Income statement
Use MS Excel to make a simple
Income statement
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Excel Basics
After launching Excel, you should have a window that looks like this. What are its elements?
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Formula Bar
Name Box
Sheet Tab
Tool Bars
Status Bar
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Cells
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Help Box
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Help Box
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View Points
But it IS important to be aware that the same
data (modeled with the same tools) can mean
very different things to different people.
Management
Investor
Bank
Supplier
Customer
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Different Perceptions
The Company
P&L, Balance Sheet
Customer
No need to adapt
everything is going well!
Lets take over something.
Investor
Management
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Income
Expenses
$ IN
$ OUT
That would give us some idea, but not really enough. Hence
well need a little more detail and it is customary to split
Income and Expenses up into the main items.
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$ IN
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$ OUT
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A quick preview
Lets have a sneak preview
+
Sales
Cost of Sales
Gross Profit
Other Expenses
EBITDA
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Sales
Cost of Sales
Gross Profit
Other Expenses
EBITDA
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An Example in Excel
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An Example in Excel
A
2
3
4
5
6
7
8
9
10
11
12
11200
7200
4000
1200
2800
800
2000
=D6 - D7
=D8 - D9
=D10 - D11
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An Example in Excel
2
3
4
5
6
7
8
9
10
11
12
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=D6/D$6
=D7/D$6
=D8/D$6
=D9/D$6
=D10/D$6
=D11/D$6
=D12/D$6
Add the
percentage
for each row
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An Example in Excel
Why the $ in the formula for the percentages?
Wait a moment Why do the percentages fail to
add up? After all shouldnt Cost of Sales +
Other Expenses + ITDA + Net Income be
100%?
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References
Better than most books!
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