An Excel spreadsheet is designed to automate the task of repetitive calculations. It can be an invaluable tool for ascertaining the income, capital investments and operating expenses of a small business. Calculating operating expenses is particularly important because it will give you an idea of how much money the business needs in each period; also, this information is required to figure certain taxes. Calculating operating expenses in Excel is not difficult once you understand how to set up the spreadsheet.
1. Launch Excel 2010. A new spreadsheet opens on the screen.
2. Click on cell "A1" and type "Expense Type" into this cell. Click on cell "B1" and type "Cost" into this cell. Click on cell "C1" and type "Total Cost" into this cell.
3. Select cell "A2" and enter the name of your first operating expense category. Operating expenses include anything your company spends money on except capital expenses and financing, such as payroll, pension payments, travel and incidental expenses, real estate rentals (but not purchases), marketing expenses, consultant fees, research and development, commissions and anything else not directly associated with producing goods. Type each expense category into a cell in column A.
4. Click on the "B" above the second column and drag your mouse over to column "C" to select both columns. Right-click anywhere within the columns and choose "Format Cells." Select "Currency" from the list on the left side of the Format Cells window. Leave the decimal places set at "2" and the currency symbol at "$." Click "OK" to close the window.
5. Click on cell "B2" and enter the actual cost of the item listed in cell A2. Go down the column and repeat this process until you have entered all your expenses.
6. Select cell "C2" and enter the following formula into the cell: =sum(B:B) Press "Enter" to complete your formula. Your total operating expense will appear in this cell. Setting up the spreadsheet in this manner will permit you to add new operating expenses and change current operating expenses, while cell C2 will always display your total.
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