Formula is an arithmetic expression or a condition consists of operands and operators. Operator is the arithmetic or logical operator symbol that is indicating the operation to be performed while operands are the values on which operation to be performed.

Example of Formula:

=2+5

In the above formula + is known as operator while 2 and 5 are known as operands.

Formula must start or in other words it must be prefixed with an equal to sign while entering into cell. Unless Excel treat it as simple text data.

After you have entered the formula in a cell, the result of formula can be seen under the cell. The formula can be seen through formula bar or in cell editing mode.

Formula can have numbers, cell addresses as operands. The advantage of using a cell address in a formula is the result of formula would update based on available data in the cells.

The usage of cell address instead of constants in a formula is known as cell referencing.

While referring a cell in a formula, you can observe the cell address in formula and cell location in the worksheet are highlighted with a single color.

If you are not convenient to entering cell address in a formula by typing, you can simply click on a cell to see automatically the name of the cell get entered in the formula.

The operations specified by the operators in the formula are performed in our reading direction by default. But the evaluation of operators follow the rules:

Order of Precedence of Arithmetic operators in Formula:

- Brackets evaluates first
- Multiplication (*), Division (/) have next preference
- Addition (+), Subtraction (-) have last preference
- If a formula contains more than one operator of same precedence, then they are evaluated from left to right.

The above specified order of evaluation of operators in the formula is already familiar to us in Mathematics that is the BODMAS rule.