Excel is well known for making personal and business accounting easier. Two tools that allow for this capability are the program’s Currency and Accounting number formats, which—alongside many other benefits—save you from having to type currency symbols manually.
Why Typing Currencies Manually Could Cause Problems
When I thought about the reasons why typing currencies manually should be avoided, the list ended up being much longer than I initially anticipated!
First, typing currencies manually could lead to number format inconsistencies, where some cells are formatted as a financial value, and others are not. Similarly, it’s easy to forget to type the currency symbol when you’re focusing on the numbers that follow, so using Excel’s built-in number format converter is the way forward.
Second, cells containing manually inserted currency symbols could cause problems if the data is extracted to another program. For example, it might prevent calculations from being made efficiently, requiring human intervention to remove the symbols manually.
Third, the dollar symbol ($) has very specific uses that are completely unrelated to currency in Excel. More specifically, adding $ to cell references turns them from relative references to absolute or mixed references, so this should be the only time you use the dollar symbol manually in Excel.
Finally, currencies in formulas will disrupt their functionality and render them incalculable.
Ultimately, Excel expects you to enter text, numbers, formulas, or mathematical symbols only into its cells, so you should avoid inserting anything else—including currency symbols.
The Benefits of Using Currency and Accounting Number Formats
Now, let’s look at why you should use Currency and Accounting number formats instead of entering currency symbols manually.
First, Excel recognizes values formatted as Currency or Accounting number formats as financial values, so the program automatically adds two decimal places (you can change the number of decimal places—see the next section for help with this).
Second, since all currency symbols are included as standard within the Currency and Accounting number formats in Excel, you don’t have to waste time trying to find ways to enter currency symbols that are not located on your keyboard.
Third, if you’re creating an official accounting document, the Accounting number format separates the currency symbol from the number and aligns the decimal points, making interpreting and analyzing the data much more straightforward and adding a professional layout to your spreadsheet.
The Currency number format also has unique visualization benefits. More specifically, it gives you the option to turn negative numbers red so that they stand out.
Finally, using Excel’s built-in Currency and Accounting number formats gives you the confidence that all financial data is formatted consistently across your spreadsheet, Excel’s calculations will not be obscured by manually inputted symbols, and the data can be extracted seamlessly to other platforms.
How to Change a Cell’s Number Format to Currency or Accounting
First, select the cells, rows, or columns containing the financial values. Then, click the number format drop-down menu in the Number group of the Home tab on the ribbon, and click “More Number Formats.” While it might be tempting to click “Currency” or “Accounting” in the drop-down list, choosing “More Number Formats” gives you more options.
In the left-hand menu of the Number tab in the Format Cells dialog box, click “Currency.” There, you can choose how many decimal places the currency displays, the currency symbol, and how negative numbers appear.
On the other hand, click “Accounting” to present your financial figures in a more stylistic fashion. This option also lets you choose the number of decimal places and the currency symbol.
The Accounting number format affects text alignment. As a result, if you apply the Accounting number format to a whole column or row that contains text as well as financial values, remember to revert those non-numerical cells to the Text format.
When you’ve chosen which number format you want to use and adjusted your settings, click “OK” to see the outcome. In my case, I’ve used the Currency number format with 0 decimal places and negative values formatted in a red font.
Now that you know how to format financial figures correctly in Microsoft Excel, why not use the program to make a simple budget? Indeed, you can use an Excel worksheet at home to help you manage your expenses and get the most out of your money!
