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Accounting for Intangible Assets

Posted by Muhammad Atif Saeed | Thursday, 8 March 2012 | Posted in , ,

imageSteve Collings looks at the fundamental principles in accounting for goodwill and intangible assets and also looks at some fundamental differences between current UK GAAP, IFRS and the proposed IFRS for SMEs.
As accountants we are all aware that an intangible asset does not have any physical form and accounting for such assets has always been a major issue for the accounting profession for many years.  Goodwill particularly has always posed problems.
Goodwill
Goodwill can primarily take two forms: purchased goodwill and internally-generated goodwill.  Goodwill is accounted for under the provisions in FRS 10 'Goodwill and Intangible Assets' and IFRS 3 'Business Combinations'. 
Under IFRS 3 and FRS 10, internally-generated goodwill cannot be capitalised.  This also applies to internally-generated brands such as mastheads, publishing titles, customer lists etc in substance.  They should, instead, be treated as either research or development costs in accordance with the principles in IAS 38 'Intangible Assets.
FRS 10 allows internally-generated intangible assets to be capitalised only if there is a readily ascertainable market value and specifically prohibits the capitalisation of internally-generated goodwill.  Where readily ascertainable values are not available then costs incurred should be written off to the profit and loss account as incurred. 
Measurement
FRS 10 requires purchased intangible assets to be capitalised at cost and amortised over its estimated useful life.  FRS 10 defines the useful economic life of an intangible asset as:
'the period over which the entity expects to derive economic benefits from that asset'. 
In some respects, goodwill and other capitalised intangible assets may be deemed to have an indefinite useful economic life or a useful economic life of more than 20 years.  A useful economic life of more than 20 years can only be chosen if two criteria are met:
·         The lifespan of the intangible asset(s) can be demonstrated to be longer than 20 years; and
·         The intangible asset is capable of continued measurement in order that annual impairment reviews can be undertaken.
For all intangible assets that have been deemed to have either an indefinite life or a lifespan of more than 20 years, annual impairment reviews must be undertaken in accordance with IAS 36 'Impairment of Assets' or FRS 11 'Impairment of Fixed Assets and Goodwill'.  If the impairment test reveals an impairment, then the asset should be written down to its recoverable amount.
Recoverable Amount
Assets carried in the balance sheet (statement of financial position) should never be carried at anymore than their recoverable amount.  IAS 36 'Impairment of Assets' and FRS 11 'Impairment of Fixed Assets and Goodwill' are similar in their determination of recoverable amount.
Under both standards, recoverable amount is the HIGHER of:
·         Fair value less costs to sell; and
·         Value in use.
Fair value less costs to sell is the amount obtainable from the sale of an asset or cash-generating unit in an arm's length transaction between knowledgeable, willing parties, less the costs involved in the disposal.
Value in use is the present value of the future cash flows expected to be derived from an asset or cash-generating unit.
A cash-generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.
Revaluation of Intangible Assets
FRS 10 prohibits the revaluation of intangible assets after their initial recognition at cost or fair value on acquisition.  Only in rare situations can intangible assets be revalued and such situations are where there are readily ascertainable market values.  Where such readily ascertainable market values are available, then all intangible assets within the same class of intangible assets must be revalued. 
Disclosures
The following are required to be disclosed in an entity's financial statements in relation to intangible assets:
·         Valuation method.
·         For each class of intangible asset:
o   The cost or revalued amount at the start of the accounting period.
o   The cumulative provisions for amortisation or impairment at the beginning and end of the period.
o   A reconciliation of the movements, showing additions, disposals, revaluations, transfers, amortisation, impairment losses and reversals of past impairment losses.
o   Carrying amount at the reporting date.
·         The method of amortisation together with the reasons for choosing the method of amortisation.
·         The reasons for, and the effect of, changing useful economic lives.
·         The reasons for, and the effect of, changing amortisation methods.
·         Where an intangible asset is amortised over more than 20 years, or has an indefinite life and is therefore not amortised, the reasons for rebutting the 20 year presumption. 
Where intangible assets have been revalued:
·         The year in which the revaluation took place and the basis of valuation.
·         The original cost or fair value and the amount of any amortisation provisions that would have been recognised if the intangible asset had not been subject to revaluation.
·         The name and qualifications of the person who valued the intangible asset.
UK GAAP versus IFRS
Under the provisions in IFRS 3 'Business Combinations' goodwill amortisation is prohibited, whereas FRS 10 permits goodwill amortisation if the useful economic life of the purchased goodwill is less than 20 years.  IFRS 3 requires annual impairment tests, whereas FRS 10 requires annual impairment tests on goodwill if the useful economic life of the goodwill is more than 20 years.
The proposed IFRS for SMEs allows amortisation of goodwill if the expected useful life of goodwill is less than 10 years.   If it is more than 10 years, then annual impairment tests are required.  In contrast, FRS 10 refers to an expected useful economic life of more than 20 years.

Internal Rate Of Return: An Inside Look

Posted by Muhammad Atif Saeed | Wednesday, 11 January 2012 | Posted in ,

The internal rate of return (IRR) is frequently used by corporations to compare and decide between capital projects, but it can also help you evaluate certain financial events in your own life, like lotteries and investments.

The IRR is the interest rate (also known as the discount rate) that will bring a series of cash flows (positive and negative) to a net present value (NPV) of zero (or to the current value of cash invested). Using IRR to obtain net present value is known as the discounted cash flow method of financial analysis. Read on to learn more about how this method is used.

IRR UsesAs we mentioned above, one of the uses of IRR is by corporations that wish to compare capital projects. For example, a corporation will evaluate an investment in a new plant versus an extension of an existing plant based on the IRR of each project. In such a case, each new capital project must produce an IRR that is higher than the company's cost of capital. Once this hurdle is surpassed, the project with the highest IRR would be the wiser investment, all other things being equal (including risk).

IRR is also useful for corporations in evaluating stock buyback programs. Clearly, if a company allocates a substantial amount to a stock buyback, the analysis must show that the company's own stock is a better investment (has a higher IRR) than any other use of the funds for other capital projects, or than any acquisition candidate at current market prices.

Calculation ComplexitiesThe IRR formula can be very complex depending on the timing and variances in cash flow amounts. Without a computer or financial calculator, IRR can only be computed by trial and error. One of the disadvantages of using IRR is that all cash flows are assumed to be reinvested at the same discount rate, although in the real world these rates will fluctuate, particularly with longer term projects. IRR can be useful, however, when comparing projects of equal risk, rather than as a fixed return projection.
Calculating IRRThe simplest example of computing an IRR is by using the example of a mortgage with even payments. Assume an initial mortgage amount of $200,000 and monthly payments of $1,050 for 30 years. The IRR (or implied interest rate) on this loan annually is 4.8%.  

Because the a stream of payments is equal and spaced at even intervals, an alternative approach is to discount these payments at a 4.8% interest rate, which will produce a net present value of $200,000. Alternatively, if the payments are raised to, say $1,100, the IRR of that loan will rise to 5.2%.

The formula for IRR, using this example, is as follows:
  • Where the initial payment (CF1) is $200,000 (a positive inflow)
  • Subsequent cash flows (CF 2, CF 3, CF N) are negative $1050 (negative because it is being paid out)
  • Number of payments (N) is 30 years times 12 = 360 monthly payments
  • Initial Investment is $200,000
  • IRR is 4.8% divided by 12 (to equate to monthly payments) = 0.400%
                      
Figure 1: The formula for calculating internal rate of return (IRR)
Power of CompoundingIRR is also useful in demonstrating the power of compounding. For example, if you invest $50 every month in the stock market over a 10-year period, that money would turn into $7,764 at the end of the 10 years with a 5% IRR, which is approximately the current Treasury (risk-free) rate.

In other words, to get a future value of $7,764 with monthly payments of $50 per month for 10 years, the IRR that will bring that flow of payments to a net present value of zero is 5%.

Compare this investment strategy to investing a lump-sum amount: to get the same future value of $7,764 with an IRR of 5%, you would have to invest $4,714 today, in contrast to the $6,000 invested in the $50-per-month plan. So, one way of comparing lump-sum investments versus payments over time is to use the IRR.

Other IRR UsesIRR analysis can be useful in dozens of ways. For example, when the lottery amounts are announced, did you know that a $100 million pot is not actually $100 million? It is a series of payments that will eventually lead to a payout of $100 million, but does not equate to a net present value of $100 million.

In some cases, advertised payouts or prizes are simply a total of $100 million over a number of years, with no assumed discount rate. In almost all cases where a prize winner is given an option of a lump-sum payment versus payments over a long period of time, the lump-sum payment will be the better alternative.

Another common use of IRR is in the computation of portfolio, mutual fund or individual stock returns. In most cases, the advertised return will include the assumption that any cash dividends are reinvested in the portfolio or stock. Therefore, it is important to scrutinize the assumptions when comparing returns of various investments. 

What if you don't want to reinvest dividends, but need them as income when paid? And if dividends are not assumed to be reinvested, are they paid out or are they left in cash? What is the assumed return on the cash? IRR and other assumptions are particularly important on instruments like whole life insurance policies and annuities, where the cash flows can become complex. Recognizing the differences in the assumptions is the only way to compare products accurately.

ConclusionAs the number of trading methodologies, mutual funds, alternative investment plans and stocks has been increasing exponentially over the last few years, it is important to be aware of IRR and how the assumed discount rate can alter results, sometimes dramatically.

Many accounting software programs now include an IRR calculator, as do Excel and other programs. A handy alternative for some is the good old HP 12c financial calculator, which will fit in a pocket or briefcase.

Gordon Growth Model

Posted by Muhammad Atif Saeed | | Posted in , ,

A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. Given a dividend per share that is payable in one year, and the assumption that the dividend grows at a constant rate in perpetuity, the model solves for the present value of the infinite series of future dividends.
Gordon Growth Model


Where:
D = Expected dividend per share one year from now
k = Required rate of return for equity investor
G = Growth rate in dividends (in perpetuity)

explains 'Gordon Growth Model'


The Gordon growth model is a type of dividend discount model used to value companies expected to grow at a constant rate forever. Most valuation models forecast growth for a certain time period before reverting to a Gordon growth model to estimate the ending value.

Because the model simplistically assumes a constant growth rate, it is generally only used for mature companies (or broad market indices) with low to moderate growth rates.

Strengths:
  • Especially useful for valuing stable-growth dividend paying companies
  • Useful for valuing broad-based equity indices
  • Simplicity and clarity
  • Helpful in understanding relationships between value, growth, required return and payout ratio
  • Useful for estimating expected rate of return
Weaknesses:
  • Output highly sensitive to assumptions for growth rate and required return
  • Not practical for valuing non-dividend paying companies
  • Not practical for valuing dividend paying stocks with unstable growth characteristics

Calculating Covariance For Stocks

Posted by Muhammad Atif Saeed | Monday, 9 January 2012 | Posted in ,

There are many elements of mathematics and statistics used in evaluating stocks. Covariance calculations can give an investor insight into how two stocks might move together in the future. Looking at historical prices, we can determine if the prices tend to move with each other, or opposite each other. This allows you to predict the potential price movement of a two stock portfolio. You might even be able to select stocks that complement each other, which can reduce the overall risk, and increase the overall potential return.
In introductory finance courses, we are taught to calculate the standard deviation of the portfolio as a measure of risk, but part of this calculation is the covariance of these two, or more, stocks. So, before going into portfolio selections, understanding covariance is very important.



What Is Covariance?Covariance is a measure of how two variables move together. It measures if the two move in the same direction (a positive covariance) or in opposite directions (a negative covariance). In this article, the variables will usually be stock prices, but it can be anything.
In the stock market, there is a strong emphasis placed on reducing the amount of risk taken on for the same amount of return. When constructing a portfolio, an analyst will select stocks that will work well together. This usually means that these stocks do not move in the same direction. Covariance can tell how the stocks move together, but to determine the strength of the relationship, we need to look at the correlation.

Calculating CovarianceThe calculation for covariance of a stock starts with finding a list of previous prices. This is labeled as "historical prices" on most quote pages. Typically, the closing price for each day is used to find the return from one day to the next. Do this for both stocks, and build a list to begin the calculations.
For example:

Day
ABC Returns (%)
XYZ Returns (%)
1
1.1
3
2
1.7
4.2
3
2.1
4.9
4
1.4
4.1
5
0.2
2.5
Table 1: Daily returns for two stocks using the closing prices
From here, we need to calculate the average return for each stock:
For ABC it would be (1.1 + 1.7 + 2.1 + 1.4 + 0.2) / 5  = 1.30
For XYZ it would be (3 + 4.2 + 4.9 + 4.1 + 2.5) / 5 = 3.74
Now, it is a matter of taking the differences between ABC's return and ABC's average return, and multiplying it by the difference between XYZ's return and XYZ's average return. The last step is to divide the result by the sample size and subtract one. If it was the entire population, then you could just divide by the population size.
Represented by this equation:



 For example:
= [(1.1 - 1.30) x (3 - 3.74)] + [(1.7 - 1.30) x (4.2 - 3.74)] + …
= [0.148] + [0.184] + [0.928] + [0.036] + [1.364]
= 2.66 / (5 - 1)
= 0.665
In this situation, we are using a sample, so we divide by the sample size (five) minus one.
You can see that the covariance between the two stock returns is 0.665, which means that they move in the same direction. When ABC had a high return, XYZ also had a high return.
Using Microsoft Excel
In Excel, you can easily find the covariance by using one the following functions:

= COVARIANCE.S()    for a sample
or
= COVARIANCE.P()    for a population
You will need to set up the two lists of returns in vertical columns, just like in Table 1. Then, when prompted, select each column. In Excel, each list is called an "array," and there should be two arrays inside the brackets, separated by a comma.
Meaning      
In the example, there is a positive covariance so the two stocks tend to move together. When one has a high return, the other tends to have a high return as well. If the result was negative, then the two stocks would tend to have opposite returns; when one had a positive return, the other would have a negative return.
Uses of Covariance
Finding that two stocks have a high or low covariance might not be a useful metric on its own, but the covariance can be used to calculate the correlation. The correlation will give a measurement between -1 and 1, and adds a strength value on how the stocks move together. If the correlation is 1, they move perfectly together, and if the correlation is -1, the stocks move perfectly in opposite directions. If the correlation is 0, then the two stocks move in random directions from each other. (To know more about correlation and portfolio management.

The covariance can also be used to find the standard deviation of a multi-stock portfolio. The standard deviation is the accepted calculation for risk, and is extremely important when selecting stocks. Typically, you would want to select stocks that move in opposite directions. If the chosen stocks work well together, then the risk will be lower given the same amount or potential return.
ConclusionCovariance is a common statistical calculation which can show how two stocks tend to move together. We can only use historical returns so there will never be complete certainty about the future. Also, it should not be used on its own. Instead, it can be used in other, more important, calculations such as correlation, or standard deviation

Return On Equity - ROE

Posted by Muhammad Atif Saeed | | Posted in , ,

The amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation's profitability by revealing how much profit a company generates with the money shareholders have invested. 

ROE is expressed as a percentage and calculated as:

Return on Equity = Net Income/Shareholder's Equity

Net income is for the full fiscal year (before dividends paid to common stock holders but after dividends to preferred stock.) Shareholder's equity does not include preferred shares.

Also known as "return on net worth" (RONW).

explains 'Return On Equity - ROE'

The ROE is useful for comparing the profitability of a company to that of other firms in the same industry.

There are several variations on the formula that investors may use:

1. Investors wishing to see the return on common equity may modify the formula above by subtracting preferred dividends from net income and subtracting preferred equity from shareholders' equity, giving the following: return on common equity (ROCE) = net income - preferred dividends / common equity.

2. Return on equity may also be calculated by dividing net income by average shareholders' equity. Average shareholders' equity is calculated by adding the shareholders' equity at the beginning of a period to the shareholders' equity at period's end and dividing the result by two.

3. Investors may also calculate the change in ROE for a period by first using the shareholders' equity figure from the beginning of a period as a denominator to determine the beginning ROE. Then, the end-of-period shareholders' equity can be used as the denominator to determine the ending ROE. Calculating both beginning and ending ROEs allows an investor to determine the change in profitability over the period.

Video Definition

Lesson 1: Entering Text and Numbers

Posted by Muhammad Atif Saeed | Friday, 6 January 2012 | Posted in ,

The Microsoft Excel Window

Microsoft Excel is an electronic spreadsheet. You can use it to organize your data into rows and columns. You can also use it to perform mathematical calculations quickly. This tutorial teaches Microsoft Excel basics. Although knowledge of how to navigate in a Windows environment is helpful, this tutorial was created for the computer novice.
This lesson will introduce you to the Excel window. You use the window to interact with Excel. To begin this lesson, start Microsoft Excel 2007. The Microsoft Excel window appears and your screen looks similar to the one shown here.
Excel Window
Note: Your screen will probably not look exactly like the screen shown. In Excel 2007, how a window displays depends on the size of your window, the size of your monitor, and the resolution to which your monitor is set. Resolution determines how much information your computer monitor can display. If you use a low resolution, less information fits on your screen, but the size of your text and images are larger. If you use a high resolution, more information fits on your screen, but the size of the text and images are smaller. Also, settings in Excel 2007, Windows Vista, and Windows XP allow you to change the color and style of your windows.

The Microsoft Office Button

Office Button

In the upper-left corner of the Excel 2007 window is the Microsoft Office button. When you click the button, a menu appears. You can use the menu to create a new file, open an existing file, save a file, and perform many other tasks.

The Quick Access Toolbar

Quick Access Toolbar

Next to the Microsoft Office button is the Quick Access toolbar. The Quick Access toolbar gives you with access to commands you frequently use. By default, Save, Undo, and Redo appear on the Quick Access toolbar. You can use Save to save your file, Undo to roll back an action you have taken, and Redo to reapply an action you have rolled back.

The Title Bar

Title Bar

Next to the Quick Access toolbar is the Title bar. On the Title bar, Microsoft Excel displays the name of the workbook you are currently using. At the top of the Excel window, you should see "Microsoft Excel - Book1" or a similar name.

The Ribbon

The Ribbon

You use commands to tell Microsoft Excel what to do. In Microsoft Excel 2007, you use the Ribbon to issue commands. The Ribbon is located near the top of the Excel window, below the Quick Access toolbar. At the top of the Ribbon are several tabs; clicking a tab displays several related command groups. Within each group are related command buttons. You click buttons to issue commands or to access menus and dialog boxes. You may also find a dialog box launcher in the bottom-right corner of a group. When you click the dialog box launcher, a dialog box makes additional commands available.

Worksheets

Worksheets
Microsoft Excel consists of worksheets. Each worksheet contains columns and rows. The columns are lettered A to Z and then continuing with AA, AB, AC and so on; the rows are numbered 1 to 1,048,576. The number of columns and rows you can have in a worksheet is limited by your computer memory and your system resources.
The combination of a column coordinate and a row coordinate make up a cell address. For example, the cell located in the upper-left corner of the worksheet is cell A1, meaning column A, row 1. Cell E10 is located under column E on row 10. You enter your data into the cells on the worksheet.

The Formula Bar

Formula bar
Formula Bar
If the Formula bar is turned on, the cell address of the cell you are in displays in the Name box which is located on the left side of the Formula bar. Cell entries display on the right side of the Formula bar. If you do not see the Formula bar in your window, perform the following steps:
  1. Choose the View tab.
  2. Click Formula Bar in the Show/Hide group. The Formula bar appears.
Note: The current cell address displays on the left side of the Formula bar.

The Status Bar

Status Bar 
The Status bar appears at the very bottom of the Excel window and provides such information as the sum, average, minimum, and maximum value of selected numbers. You can change what displays on the Status bar by right-clicking on the Status bar and selecting the options you want from the Customize Status Bar menu. You click a menu item to select it. You click it again to deselect it. A check mark next to an item means the item is selected.

Move Around a Worksheet

By using the arrow keys, you can move around your worksheet. You can use the down arrow key to move downward one cell at a time. You can use the up arrow key to move upward one cell at a time. You can use the Tab key to move across the page to the right, one cell at a time. You can hold down the Shift key and then press the Tab key to move to the left, one cell at a time. You can use the right and left arrow keys to move right or left one cell at a time. The Page Up and Page Down keys move up and down one page at a time. If you hold down the Ctrl key and then press the Home key, you move to the beginning of the worksheet.

EXERCISE 1

Move Around the Worksheet

The Down Arrow Key

  • Press the down arrow key several times. Note that the cursor moves downward one cell at a time.

The Up Arrow Key

  • Press the up arrow key several times. Note that the cursor moves upward one cell at a time.

The Tab Key

  1. Move to cell A1.
  2. Press the Tab key several times. Note that the cursor moves to the right one cell at a time.

The Shift+Tab Keys

  • Hold down the Shift key and then press Tab. Note that the cursor moves to the left one cell at a time.

The Right and Left Arrow Keys

  1. Press the right arrow key several times. Note that the cursor moves to the right.
  2. Press the left arrow key several times. Note that the cursor moves to the left.

Page Up and Page Down

  1. Press the Page Down key. Note that the cursor moves down one page.
  2. Press the Page Up key. Note that the cursor moves up one page.

The Ctrl-Home Key

  1. Move the cursor to column J.
  2. Stay in column J and move the cursor to row 20.
  3. Hold down the Ctrl key while you press the Home key. Excel moves to cell A1.

Go To Cells Quickly

The following are shortcuts for moving quickly from one cell in a worksheet to a cell in a different part of the worksheet.

EXERCISE 2

Go to -- F5

The F5 function key is the "Go To" key. If you press the F5 key, you are prompted for the cell to which you wish to go. Enter the cell address, and the cursor jumps to that cell.
  1. Press F5. The Go To dialog box opens.
  2. Type J3 in the Reference field.
  3. Press Enter. Excel moves to cell J3.

Go to -- Ctrl+G

You can also use Ctrl+G to go to a specific cell.
  1. Hold down the Ctrl key while you press "g" (Ctrl+g). The Go To dialog box opens.
  2. Type C4 in the Reference field.
  3. Press Enter. Excel moves to cell C4.

The Name Box

You can also use the Name box to go to a specific cell. Just type the cell you want to go to in the Name box and then press Enter.
Name Box
  1. Type B10 in the Name box.
  2. Press Enter. Excel moves to cell B10.

Select Cells

Select Cells
If you wish to perform a function on a group of cells, you must first select those cells by highlighting them. The exercises that follow teach you how to select.

EXERCISE 3

Select Cells

To select cells A1 to E1:
  1. Go to cell A1.
  2. Press the F8 key. This anchors the cursor.
  3. Note that "Extend Selection" appears on the Status bar in the lower-left corner of the window. You are in the Extend mode.
  4. Click in cell E7. Excel highlights cells A1 to E7.
  5. Press Esc and click anywhere on the worksheet to clear the highlighting.

Alternative Method: Select Cells by Dragging

You can also select an area by holding down the left mouse button and dragging the mouse over the area. In addition, you can select noncontiguous areas of the worksheet by doing the following:
Select Noncontiguous Areas
  1. Go to cell A1.
  2. Hold down the Ctrl key. You won't release it until step 9. Holding down the Ctrl key enables you to select noncontiguous areas of the worksheet.
  3. Press the left mouse button.
  4. While holding down the left mouse button, use the mouse to move from cell A1 to C5.
  5. Continue to hold down the Ctrl key, but release the left mouse button.
  6. Using the mouse, place the cursor in cell D7.
  7. Press the left mouse button.
  8. While holding down the left mouse button, move to cell F10. Release the left mouse button.
  9. Release the Ctrl key. Cells A1 to C5 and cells D7 to F10 are selected.
  10. Press Esc and click anywhere on the worksheet to remove the highlighting.

Enter Data

In this section, you will learn how to enter data into your worksheet. First, place the cursor in the cell in which you want to start entering data. Type some data, and then press Enter. If you need to delete, press the Backspace key to delete one character at a time.

EXERCISE 4

Enter Data

Enter Data
  1. Place the cursor in cell A1.
  2. Type John Jordan. Do not press Enter at this time.
Enter Data

Delete Data

The Backspace key erases one character at a time.
  1. Press the Backspace key until Jordan is erased.
  2. Press Enter. The name "John" appears in cell A1.

Edit a Cell

After you enter data into a cell, you can edit the data by pressing F2 while you are in the cell you wish to edit.
Edit Cell

EXERCISE 5

Edit a Cell

Change "John" to "Jones."
  1. Move to cell A1.
  2. Press F2.
  3. Use the Backspace key to delete the "n" and the "h."
  4. Type nes.
  5. Press Enter.

Alternate Method: Editing a Cell by Using the Formula Bar

You can also edit the cell by using the Formula bar. You change "Jones" to "Joker" in the following exercise.
Formula Bar 1
  1. Move the cursor to cell A1.
  2. Click in the formula area of the Formula bar.
Formula Bar
  1. Use the backspace key to erase the "s," "e," and "n."
  2. Type ker.
  3. Press Enter.

Alternate Method: Edit a Cell by Double-Clicking in the Cell

You can change "Joker" to "Johnson" as follows:
Double Click to Edit
  1. Move to cell A1.
  2. Double-click in cell A1.
  3. Press the End key. Your cursor is now at the end of your text.
Double Click to Edit 2
  1. Use the Backspace key to erase "r," "e," and "k."
  2. Type hnson.
  3. Press Enter.

Change a Cell Entry

Typing in a cell replaces the old cell entry with the new information you type.
  1. Move the cursor to cell A1.
  2. Type Cathy.
  3. Press Enter. The name "Cathy" replaces "Johnson."
Change a Cell Entry

Wrap Text

When you type text that is too long to fit in the cell, the text overlaps the next cell. If you do not want it to overlap the next cell, you can wrap the text.

EXERCISE 6

Wrap Text


Wrap Text
  1. Move to cell A2.
  2. Type Text too long to fit.
  3. Press Enter.
Wrap Text
  1. Return to cell A2.
  2. Choose the Home tab.
  3. Click the Wrap Text button Wrap Text Button. Excel wraps the text in the cell.

Delete a Cell Entry

To delete an entry in a cell or a group of cells, you place the cursor in the cell or select the group of cells and press Delete.

EXERCISE 7

Delete a Cell Entry

  1. Select cells A1 to A2.
  2. Press the Delete key.

Save a File

This is the end of Lesson1. To save your file:
  1. Click the Office button. A menu appears.
  2. Click Save. The Save As dialog box appears.
  3. Go to the directory in which you want to save your file.
  4. Type Lesson1 in the File Name field.
  5. Click Save. Excel saves your file.

Close Excel

Close Microsoft Excel.
  1. Click the Office button. A menu appears.
  2. Click Close. Excel closes.

A Sample Cover Letter For A Job Application

Posted by Muhammad Atif Saeed | Tuesday, 3 January 2012 | Posted in ,

Most jobs ask for a cover letter along with your resume. A cover letter can make or break your case with the prospective employer. I am giving a sample cover letter below in the format which most business schools follow in the USA. I am assuming that the applicant is doing his/her MBA right now. Make sure you put in the correct postal address and other details in the letter below. It is like a template right now. The names used below are used just as an example and are fake. Study the below letter carefully and draft your own cover letter for your applications. Good luck.

120 Orchard Avenue
Yourtownname, MN zip code
Tel: (xxx) xxx-xxxx
Email: your email id

September 9, 2007

Mr. Dave Clayton
HR Manager
XYZ, Inc.
140 Oak Street
Theirtownname, MN zip code

Dear Mr. Clayton:

I came to know about a managerial job opening in the marketing team at your company from Robert Woods of United Services. With my work experience and MBA in marketing, I feel that I am an ideal candidate for the position.

I have been following the progress of XYZ, Inc. since last two years from newspapers and trade journals. I am keenly interested in the online-offline model developed by your company to sell products on the Internet and in retail outlets. Before I started my MBA, I worked extensively in marketing and retailing products on e-commerce websites. Currently, I am sharpening my skills in the traditional marketing areas with my MBA studies. I plan to graduate in December 2008 with an emphasis in marketing. I find a great synergy between your company and my background and experience. I am sure, that as a marketing manager in your company, I will be able to take the department to new heights.


I am eager to talk to you and learn more about the managerial position. I want to discuss with you, the new ideas which I have for XYZ, Inc. Please review my resume. I will contact you after a week to know about the possibility of arranging a meeting with you.

Your time and consideration is greatly appreciated.


Sincerely,

Your full name

Enclosure: Resume

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I am doing ACMA from Institute of Cost and Management Accountants Pakistan (Islamabad). Computer and Accounting are my favorite subjects contact Information: +923347787272 atifsaeedicmap@gmail.com atifsaeed_icmap@hotmail.com
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