Excel formula for percentage decrease and percentage difference

Excel formula for percentage decrease and percentage difference

The analysis involves the calculation of differences between two values. You can also carry out simple percentage operations on your excel spreadsheet. The difference between the two values means change. This change can occur in the form of an increase or a decrease. For instance, your company may want to find the cost of production between last year and this year. In this case, the difference will come in two ways. Either an increase or a decrease.

 

You can also deduce the difference in terms of percentage.

Mathematically, the percentage difference is calculated thus:

% difference = {(Original value — New value)/ Original value} x 100

To find the difference in the cost of production in terms of percentage, you subtract this year’s cost from last year’s cost and divide the result (difference) by last year’s cost, and then you multiply by 100.

Example: Assume that last year’s production cost was $10,000, while the cost of production for this year is $11,000.

The difference will be deduced as follows:

Difference = (Last year’s cost — this year’s cost)

= (10,000 — 11,000)

= -1,000

The percentage difference will then be calculated as follows:

Percentage difference = (Difference/Last year’s cost) x 100

= (-1000/10,000) x 100

= -10%

By substituting the values of the cost of production for each year in the formula above, we arrive at -10% as a result.

Percentage difference can either be positive (increase) or negative (decrease).

When finding the percentage difference and your result is a negative value, know that your answer is ”percentage decrease”.

If your result is a positive percentage, then your answer is ”percentage increase.”

In your Excel spreadsheet, you can perform a similar calculation by substituting the numbering of the cells in the formula above.

Example:

Supposing we want to calculate the percentage change and percentage difference between our last month’s revenue and this month’s revenue. If last month’s revenue was $17,500 and this month’s revenue is $12,500, we can find the percentage decrease in Excel by using the formula below:

=(B1 — B2)÷B1.

On your excel spreadsheet, if this month’s revenue, $12500 is in cell B1 while last month’s revenue $17,500 is in cell B2;

The percentage decrease will be —40%, a negative value.

Meanwhile, we can also find the percentage difference. If last month’s revenue was $12,500 and this month’s revenue is $17,500, and the two values occupy cells B1 & B2 respectively, we can find the percentage difference in Excel by using the formula below:

=(B2 — B1)÷B1

 

 

 

 

 

 

The percentage difference will be 40%, a positive value.

Meanwhile, after entering your formula on the Excel spreadsheet, your result will be displayed in decimal form. You need to format the result to a percentage. To do so, simply click the ”percent symbol” on the home tab of your Excel window.