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ne of the most critical tasks of accountants is
translating those dry columns of financial
numbers into information that management can
quickly comprehend. One effective tool is the
chart, which graphically demonstrates what the
numbers mean. But, as good as charts are, the
traditional ones have an inherent weakness. For
example, if you want to show how spiraling
marketing costs, spent to boost sales, will
deplete profits, then the traditional chart
probably lacks the punch you’re trying to
achieve. In other words, if the sales numbers are
large and growing fast while the profits are
relatively small and shrinking, a conventional
chart of their relationship will not illustrate
your point.
The good
news: That weakness is correctable. With a
few adjustments, you can transform a lackluster
chart into one that commands attention. Follow
along and see how.
| Consider the
chart in exhibit 1, at right,
which compares soaring Sales
(the blue line) with ebbing Operating
income (the pink line). While
it’s clear that sales are rising,
that slightly dipping pink line certainly
isn’t making the point that profits
are collapsing. Fortunately,
Excel, which can easily convert tables
into charts, has special ways to address
such a situation. To illustrate
we’ll create a chart with the
underlying spreadsheet data shown in exhibit 2, below. You may
want to duplicate the chart and work
along with me.
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Once
you’ve created the worksheet, hold down the
Ctrl key while highlighting the header (row 4), Sales
(row 5) and Operating income
(row 9). When highlighted, they are shaded gray.
Click on Insert
on the toolbar, then Chart to
bring up the Chart Wizard (exhibit
3,
below). Select the Custom Types
tab and scroll down to Lines on 2 Axes.
Click twice on Next
to get to Step 3 and
then click on the Titles
tab. Enter Snick’s Snack
Sales as the Chart title.
Enter Sales in the Value
(Y) axis field and Operating
income in the Second value (Y)
axis field (exhibit 4, below).
The
default placement of the legend is to the
right of the chart. To move it to another
location in the chart, click on the Legend
tab, click on another selection and wait
a few seconds for the legend to appear.
You can test each placement until you are
satisfied with the results (exhibit 5, below right).
Now press Next.
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To place
the finished chart on the same worksheet as the
data, simply click on Finish. If
you wish to place it on a separate sheet, enter a
new worksheet name, such as 2003 Chart, and then click on Finish
(exhibit 6, below).
CHANGE
LOCATION
If you want to change its location after
you have placed the chart on the data
sheet, right-click inside the chart once
and then click on Location
from the menu. This will bring up the Chart
Location window. But if you
originally had placed the chart in its
own worksheet and now you want to move
it, you don’t have to click on the
chart; simply go to the menu bar at the
top and select Chart and
then Location to get the
Chart Location window.
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| To change a line
color, right-click on it and choose Format
Data Series (exhibit 7, above). Click
on the Patterns tab and
change the line color from Automatic
and the Foreground
marker color to the desired colors.
Increase the thickness (Weight)
of the line by clicking on the down arrow
and by selecting a heavier line. Then
click on OK. You also can add
data points for emphasis along the chart
lines (exhibit 8, at right). To
do that right-click on the Sales
(blue) line and choose Format
Data Series. Select the Data
Labels tab and check the Value
box.
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If necessary, you can reposition
the data labels by right-clicking on one
of them. Then select Format Data
Labels and click on the Alignment
tab and change the label position.
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| To enhance the
emphasis, you also can change the scale
on one or both Y-axes. Compare the
difference between exhibit 8 and exhibit 9, at right. To
do that, right-click on the primary (left
vertical) Y-axis and select Format
Axis from the shortcut menu.
Choose the Scale tab and
change Minimum from the
default of 0 to 20,000. As you can see,
you can transform numbers into effective,
easy-to-understand pictures. So get
familiar with Excel’s chart
functions to send the message you want. 
Resource
TECH
Conference
May 2–5, 2004
Venetian, Las Vegas |
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TERRYANN
GLANDON, CPA, PhD, is an assistant professor of
accounting at the University of Texas at El Paso.
Her e-mail address is tglandon@utep.edu.
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