The first step in inserting a function is to choose a cell to contain the function result. Once you select a cell, display the Insert Function dialogue box by clicking the fx button next to the formula bar. You can also choose Insert->Function from the menu bar, or display the drop list on the AutoSum button and select More Functions from the available options.

As discussed in lesson 1.2, the insert function dialogue box lets you select functions by category using the drop list. You can also find functions by entering a description and clicking the GO button.

The Help on this function link is available if you need clarification on the use of a selected function.

Once you choose a function you can click OK to move to the next step (the function arguments box).

This image shows the Function arguments box.

For this example the PMT function has been selected from the financial category. The PMT function will calculate the payment amount for a loan based on the arguments you provide.

In the upper part of the box, you will see a series of text fields; one for each possible argument to the function. If you click on an argument field, a brief description of the argument will appear at the bottom of the dialogue box. In this example, you can see the description for the Rate argument.

You can also see argument names to the left of the argument fields. The ones in bold type (Rate, Nper, and Pv) are required arguments. As for the arguments without bold type names, Excel will enter a default value if the argument fields are left empty.

You can enter raw data directly onto the argument fields, or if the data is stored in your worksheet, you can type the appropriate cell references. You can also click on an argument field, and then click on the cell that contains the data to enter it without typing. You can navigate between fields by pressing the Tab key.

Here you can see the completed PMT function arguments. Cell references for the cells that contain the data can be seen in the argument fields. The raw data itself can be seen just to the right of the argument fields. The Rate field contains C6/12 because the payments are to be made monthly, requiring us to divide the yearly rate of 6% (in C6) by 12 for a monthly rate. The monthly payment of $430.33 will be visible in the cell that was selected to contain the formula.

This process lets us insert functions into a worksheet without having to manually type them. The resulting function is exactly the same as if we typed =PMT (C6/12, C7, D7,, 0) directly into the formula bar. By using the insert function feature, you do not have to worry about parentheses and commas. You can also clearly see the argument descriptions, and how many arguments are required.