Imagine you are the head of Accounts Receivable department at a large company. Drab, I know, But humor me and imagine.
Now, every month you get a transaction report like this:
And you want to know which numbers are matching up.
i.e, if your company gave Vendor-0002 $872.34 on 1st of April, 2014 and your received below payments from them subsequently,
- $427.77 on 1st April
- $152.88 on 2nd April
- $291.69 on 2nd April
Then you consider the account matched since the total received is same as total payable.(427.77 + 152.88 + 291.69 = 872.34).
Manually identifying all such matching transactions can be tedious, boring & error-prone.
This is where formulas come handy.
Using simple Excel formulas, we can identify all matching transactions, highlight them using conditional formatting so that you can chase the vendors with an outstanding.
Note: thanks to Kirstin whose email question prompted me to write this article.
Using formulas to match up (reconcile) accounting transactions
Step 1: Lets take a look at the data
This is how our AR (Accounts Receivable) data looks above (very first image in this post).
For the sake of simplicity I have set up this data as an Excel table.
Step 2: Write the formula
Here is the criteria for matching.
- If the total amounts (paid & received) corresponding to a vendor is zero, we consider it matched.
- Else not.
Add an extra column to the table and write this formula.
=ROUND(SUMIFS([Amount],[Vendor Reference],[@[Vendor Reference]]),2)=0
What this formula does:
It gives TRUE if a particular vendor’s amounts to total to ZERO
else FALSE
How it works?
The SUMIFS formula sums up all the numbers for the vendor name in current row [@[Vendor Reference]]
The ROUND formula rounds it to 2 digit precision. We need to use this because of a floating point error in Excel (that returns extremely small values when the result should be zero).
Related: How to use structural references in Excel
Step 3: Fill down the formula
Fortunately, you don’t have to do this step. Excel automatically fills the formula down as we are using tables. Yay!
Step 4: Highlight matched rows using conditional formatting.
Make a note of the column where TRUE / FALSE values are calculated. In my set-up, it is column E.
Select the entire table. Go to conditional formatting > new rule from home ribbon.
Set up a rule like this:
Note the mixed reference style $E4. This ensures that for highlighting all columns, Excel checks only column E.
That is all. You have now matched all the paid-up transactions. Time to flex your muscles, put-up your legs on the desk and call those other people who did not pay yet.
Download example workbook
Click here to download example workbook & practice. Examine formulas & conditional formatting to learn more.
How do you reconcile / match-up transactions?
I will be honest. I have never been the head of accounts receivable department. Even in my own household, I do not handle receivables. My wife takes care of that. I handle payables (ie credit card bills, shopping expenses and other such things).
But I often use formulas to reconcile my bank statement.
What about you? Do you use formulas to match transactions. What techniques you rely on? Please share your tips & ideas using comments.
Bonus homework
Assuming we have data like above, what formula answers the question:
How many vendors have their transactions matched?
Post your formulas in comments.
12 Responses to “Analyzing Search Keywords using Excel : Array Formulas in Real Life”
Very interesting Chandoo, as always. Personally I find endless uses for formulae such as {=sum(if(B$2:B$5=$A2,$C$2$C$5))}, just the flexibility in absolute and relative relative referencing and multiple conditions gives it the edge over dsum and others methods.
I've added to my blog a piece on SQL in VBA that I think might be of interest to you http://aviatormonkey.wordpress.com/2009/02/10/lesson-one-sql-in-vba/ . It's a bit techie, but I think you might like it.
Keep up the good work, aviatormonkey
Hi Chandoo,
You might find this coded solution I posted on a forum interesting.
http://www.excelforum.com/excel-programming/680810-create-tag-cloud-in-vba-possible.html
[...] under certain circumstances. One of the tips involved arranging search keywords in excel using Array Forumlas. Basically, if you need to know how frequent a word or group of keywords appear, you can use this [...]
@Aviatormonkey: Thanks for sharing the url. I found it a bit technical.. but very interesting.
@Andy: Looks like Jarad, the person who emailed me this problem has posted the same in excelforum too. Very good solution btw...
Realy great article
"You can take this basic model and extend it to include parameters like number of searches each key phrase has, how long the users stay on the site etc. to enhance the way tag cloud is generated and colored."
How would you go about doing this? I think it would need some VB
Hi,
I found the usage very interesting, but is giving me hard time because the LENs formula that use ranges are not considering the full range, in other words, the LEN formula is only bringing results from the respective "line" cell.
Using the example, when I place the formula to calculate the frequency for "windows" brings me only 1 result, not 11 as displayed in the example. It seems that the LEN formula using ranges is considering the respective line within the range, not the full range.
Any hint?
@Thiago
You have to enter the formula as an Array Formula
Enter the Formula and press Ctrl+Shift+Enter
Not just Enter
Thank you, Hui! I couldn't work out how this didn't work
is there a limit to the number of lines it can analyse.
Ie i am trying to get this to work on a list of sentances 1500 long.
@Gary
In Excel 2010/2013 Excel is only limited by available memory,
So just give it a go
As always try on a copy of the file first if you have any doubts
Apologies if I am missing something, but coudn't getting frequency be easier with Countif formula. Something like this - COUNTIF(Range with text,"*"&_cell with keyword_&"*")
Apologies if I missed, but what is the Array Formula to:
1. Analyze a list of URL's or a list of word phrases to understand frequency;
2. List in a nearby column from most used words to least used words;
3. Next to the list of words the count of occurrences.