Lesson: How to calculate financial ratios with Microsoft Copilot?

Financial ratios are crucial for analyzing a company's financial health.

Microsoft Copilot in Excel simplifies the calculation of these ratios, making financial analysis more accessible and less time-consuming.

Steps to Calculate Financial Ratios

1. Accessing Copilot in Excel

• Activating Copilot: Access Copilot through the Copilot icon in the Excel toolbar.
• Data Preparation: Start with a dataset that includes financial figures like net profit, revenue, and gross profit.

2. Converting Data to Excel Table

• Table Conversion: Convert the data range into an Excel table, which is required for Copilot to operate efficiently.

3. Generating Net Profit Margin Column

• Requesting Calculation: Use the Copilot pane to request the generation of a new column for net profit margin.
• Automatic Calculation: Copilot analyzes the data and suggests the formula (net profit divided by revenue).
• Inserting the Column: Approve the suggestion to automatically insert the net profit margin column into the dataset.

4. Calculating Gross Profit Margin

• Requesting Gross Profit Margin: Similar to net profit margin, request Copilot to generate a column for gross profit margin.
• Approving Calculation: Review and approve Copilot’s suggestion for the gross profit margin formula (gross profit divided by revenue).

Conclusion

Microsoft Copilot in Excel offers an effective and efficient method for calculating important financial ratios. By automating these calculations, Copilot enables finance professionals to focus more on analysis and less on the mechanics of data manipulation.