ABS Function in Microsoft Excel

Part 1: Introduction

Definition

The ABS function in Excel is a mathematical function that returns the absolute value of a number.

Purpose

The purpose of the ABS function is to return the absolute value of a number, which is the number without its sign. This can be useful in various scenarios where you want to consider only the magnitude of a number without regard to its character.

Syntax & Arguments

The syntax for the ABS function is as follows:

syntax

ABS(number)

The ABS function has only one argument:

Number: This is the actual number you want the absolute value.

Return Value

The ABS function returns the absolute value of the number provided as the argument.

Remarks

The ABS function ignores the sign of the number, so it always returns a positive value or zero. The ABS function returns the number itself if the argument is positive or zero. If the argument is a negative number, the ABS function returns the positive counterpart of the number.

Part 2: Examples

Let’s look at some examples of using the ABS function in business.

Example 1

Purpose: To calculate the absolute value of sales differences.

	A	B	C	D
1	Sales Last Month	Sales This Month	Sales Difference (Formula)	Sales Difference (Result)
2	5000	6000	`=ABS(A2-B2)`	1000
3	7000	6500	`=ABS(A3-B3)`	500
4	8000	7500	`=ABS(A4-B4)`	500

Explanation: In this example, we calculate the absolute value of the difference in sales between last month and this month. This can be useful when we want to measure the magnitude of change without considering whether it’s an increase or decrease.

Example 2

Purpose: To calculate the absolute value of profit differences.

	A	B	C	D
1	Profit Last Quarter	Profit This Quarter	Profit Difference (Formula)	Profit Difference (Result)
2	20000	25000	`=ABS(A2-B2)`	5000
3	30000	28000	`=ABS(A3-B3)`	2000
4	40000	42000	`=ABS(A4-B4)`	2000

Explanation: Here, we calculate the absolute value of the difference in profit between the last quarter and this quarter. This can be useful when we want to measure the magnitude of change without considering whether it’s a profit increase or decrease.

Example 3

Purpose: To calculate the absolute value of inventory differences.

	A	B	C	D
1	Inventory Last Week	Inventory This Week	Inventory Difference (Formula)	Inventory Difference (Result)
2	100	120	`=ABS(A2-B2)`	20
3	150	140	`=ABS(A3-B3)`	10
4	200	190	`=ABS(A4-B4)`	10

Explanation: In this example, we calculate the absolute value of the difference in inventory between last week and this week. This can be useful when we want to measure the magnitude of change without considering whether it’s an inventory increase or decrease.

Example 4

Purpose: To calculate the absolute value of temperature differences.

	A	B	C	D
1	Temperature Yesterday (°C)	Temperature Today (°C)	Temperature Difference (Formula)	Temperature Difference (Result)
2	20	25	`=ABS(A2-B2)`	5
3	30	28	`=ABS(A3-B3)`	2
4	35	33	`=ABS(A4-B4)`	2

Explanation: Here, we calculate the absolute value of the difference in temperature between yesterday and today. This can be useful when we want to measure the magnitude of change without considering whether it’s a temperature increase or decrease.

Example 5

Purpose: To calculate the absolute value of exchange rate differences.

	A	B	C	D
1	Exchange Rate Last Month	Exchange Rate This Month	Exchange Rate Difference (Formula)	Exchange Rate Difference (Result)
2	1.20	1.25	`=ABS(A2-B2)`	0.05
3	1.30	1.28	`=ABS(A3-B3)`	0.02
4	1.35	1.33	`=ABS(A4-B4)`	0.02

Explanation: In this example, we calculate the absolute value of the difference in exchange rates between last month and this month. This can be useful when measuring the magnitude of change without considering whether it’s an exchange rate increase or decrease.

📌 Example 6:

Purpose: Determining the absolute difference between budgeted and actual sales.
Data tables and formulas:

	A	B	C	D
1	Budgeted Sales	Actual Sales	Absolute Difference Formula	Result
2	$5,000	$4,800	=ABS(A2-B2)	$200
3	$6,000	$6,500	=ABS(A3-B3)	$500
4	$7,000	$6,900	=ABS(A4-B4)	$100

Explanation: In business, comparing budgeted figures with actual results is crucial. Here, we’re using the ABS function to determine the absolute difference between budgeted and solid sales, giving a clear picture of deviations without considering if the actual sales were over or under the budget.

📌 Example 7:

Purpose: Using the ABS function with IF to determine if sales targets were met.
Data tables and formulas:

	A	B	C	D
1	Target Sales	Actual Sales	Target Met Formula	Result
2	$10,000	$9,500	=IF(ABS(A2-B2)<=500, “Met”, “Not Met”)	Met
3	$12,000	$11,200	=IF(ABS(A3-B3)<=500, “Met”, “Not Met”)	Met
4	$15,000	$14,200	=IF(ABS(A4-B4)<=500, “Met”, “Not Met”)	Not Met

Explanation: Businesses often have a tolerance range to determine if sales targets are met. Here, we’re using the ABS function nested within a IF statement to check if the absolute difference between target and actual sales is within a $500 range.

📌 Example 8:

Purpose: Calculate the sum of absolute differences between forecasted and actual expenses.
Data tables and formulas:

	A	B	C	D
1	Forecasted Expenses	Actual Expenses	Absolute Difference Formula	Result
2	$2,000	$2,100	=ABS(A2-B2)	$100
3	$3,000	$2,900	=ABS(A3-B3)	$100
4	$4,000	$4,200	=ABS(A4-B4)	$200
5	Total		=SUM(D2:D4)	$400

Explanation: Forecasting expenses is a common practice in businesses. By using the ABS function combined with the SUM function, we can calculate the total absolute difference between forecasted and actual expenses, providing a clear picture of the overall accuracy of the forecasts.

📌 Example 9:

Purpose: Using ABS with VLOOKUP to find the absolute difference between a product’s listed price and its sale price.
Data tables and formulas:

	A	B	C	D
1	Product	Listed Price	Sale Price	Absolute Difference Formula
2	Widget A	$50	$45	=ABS(B2-VLOOKUP(A2,E:F,2,FALSE))
3	Widget B	$60	$58	=ABS(B3-VLOOKUP(A3,E:F,2,FALSE))
4	Widget C	$70	$65	=ABS(B4-VLOOKUP(A4,E:F,2,FALSE))

	E	F
1	Product	Sale Price
2	Widget A	$45
3	Widget B	$58
4	Widget C	$65

Explanation: Businesses often have a list of products with their respective prices. When products go on sale, it’s helpful to determine the absolute difference between the listed price and the sale price. Here, we’re using the ABS function nested with VLOOKUP to fetch the sale price and calculate the difference.

📌 Example 10:

Purpose: Using ABS with AVERAGE to find the average absolute deviation from the mean.
Data tables and formulas:

	A	B	C
1	Data	Absolute Deviation Formula	Result
2	5	=ABS(A2-AVERAGE(A$2:A$4))	1.67
3	6	=ABS(A3-AVERAGE(A$2:A$4))	0.67
4	8	=ABS(A4-AVERAGE(A$2:A$4))	1.33

Explanation: In statistics, the average absolute deviation measures the dispersion of data points. By using the ABS function nested with AVERAGE, we can determine how far each data point deviates from the mean on average.

📌 Example 11:

Purpose: Using ABS with MAX to find the maximum absolute deviation from a target.
Data tables and formulas:

	A	B	C
1	Data	Absolute Deviation Formula	Result
2	10	=ABS(A2-15)	5
3	14	=ABS(A3-15)	1
4	16	=ABS(A4-15)	1
5	Max Deviation	=MAX(C2:C4)	5

Explanation: When tracking performance against a target, knowing the maximum deviation is useful. Here, we’re using the ABS function nested with MAX to find the most significant absolute deviation from a target of 15.

📌 Example 12:

Purpose: Using ABS with MIN to find the minimum absolute deviation from a baseline.
Data tables and formulas:

	A	B	C
1	Data	Absolute Deviation Formula	Result
2	50	=ABS(A2-55)	5
3	54	=ABS(A3-55)	1
4	56	=ABS(A4-55)	1
5	Min Deviation	=MIN(C2:C4)	1

Explanation: In some scenarios, knowing the slightest deviation from a baseline is essential. Here, we’re using the ABS function nested with MIN to find the most minor absolute deviation from a baseline of 55.

Part 3: Tips and Tricks

The ABS function can be combined with other functions to perform more complex calculations.
Remember that the ABS function always returns a positive value or zero, so it’s unsuitable for situations where you need to preserve the sign of the number.
The ABS function can be used on various cells with the Excel array formula functionality.
If you want to calculate the absolute value of differences, like in the examples above, you can use the ABS function in combination with the subtraction operator (-).
The ABS function can be used in financial calculations where the magnitude of numbers is essential, such as in risk analysis or variance analysis.

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ABS Function in Excel