# How to Calculate Ratios in Excel?

In today’s data-driven world, understanding how to calculate ratios is crucial for professionals, students, and researchers alike.

Ratios provide valuable insights into financial performance, operational efficiency, and market trends, making them an essential tool for extracting meaningful data efficiently. Moreover, ratios enable comparisons and trend analysis, aiding stakeholders in making informed decisions.

Fortunately, with its powerful functions and formulas, Excel offers an easy and efficient way to calculate ratios, saving time and effort while ensuring accuracy.

In this article, we will explore a few simple methods that can be used anywhere and everywhere in Excel to calculate ratios swiftly.

## 4 Things to Know When Calculating Ratios in Excel

Before we take a look at the formulas, let’s understand the four things you should know about calculating ratios in Excel:

• To perform ratio calculations in Excel, you will need specific numeric values to determine the ratio. Please ensure that the units of measurement used for the numerator and denominator are consistent. Ratios should compare quantities of the same unit.
• Remember, Excel does not have a specific function dedicated to calculating ratios. Choose the appropriate formula or method for calculating ratios in Excel based on your specific needs and preferences. Consider factors such as accuracy, simplicity, and desired output format. All of this is explained in this article.
• Both the numbers should be positive.
• The second number should not be Zero as it is mathematically undefined. Make sure the denominator is not zero to ensure valid ratio calculations.

Now, let’s look at the four different methods to calculate ratios in Excel easily.

## Method 1: Create Ratio with GCD Method

The Greatest Common Divisor (GCD) method calculates the greatest common denominator between two numbers. It is a simple and easy method to use anytime you wish to calculate ratios in Excel. Ratios are a type of fraction consisting of two parts. They are:

• The numerator (known as the antecedent)
• The denominator (known as the consequent)

The formula for GCD is =GCD(Number 1, Number 2)

Once you understand how GCD works, you can use the function to find your ratios by dividing each of the two numbers by their GCD and separating the answers with a colon “:” used to represent a ratio.

Let’s take a look at calculating ratios with the GCD Method.

For this, consider the example of two vendors selling five common varieties of fruits.

We will find the ratio of the fruits both held in stock. Follow the steps mentioned below to implement the GCD method.

Let’s understand the dataset- Select the first four columns on your Excel sheet. Dedicate column A to fruits, column B to Vendor 1, column C to Vendor 2. We will calculate the GCD in Column D.

Step 1: Use the GCD Method

We will calculate the GCD in column D and then the ratio in column E

`= GCD(B2,C2)`

Drag down the formula to copy in the rest of the cells

Step 2: Now, let’s calculate the ratio.

To calculate the ratio, type the below formula in Column E

`=B2/D2&":"&C2/D2`

Step 3: Calculate For All Cells

Once you have entered the formula and received the final result, drag your cursor downward to calculate the ratios for all the cells.

Tip: If you do not want to create additional column or step that calculates GCD value, you can also combine Step 1 and Step 2 where the GCD value is calculated itself. Use the below formula in that case:

`=B2/GCD(B2,C2)&":"&C2/GCD(B2,C2)`

## Method 2: Create Ratio with Text Function

Another popular method of calculating ratios in Excel is the TEXT and SUBSTITUTE TEXT functions. You can use this formula in any version of Excel. Follow the steps mentioned below to get the results:

Using the same dataset as used in the method 1

Formula to be used: =TEXT(B2/C2,”0/0″)

Step 1: You will see 5/2 as a result in Column D

Step 2: Calculate the Ratio for All Cells

• Since you have 5/2 as a result, select the cell and drag the cursor down to calculate similar results for each cell

Step 3: Use Substitute Function to convert slash into colon

• To get the final result, Select D2

Enter the formula:

`=SUBSTITUTE(TEXT(B2/C2,"0/0"),"/",":")`
• Click ‘Enter’ and you will get the final result as 5:2

Step 4: The Final output for all cells

• Select the cell and drag your cursor downward to calculate the ratio for all the cells.

## Method 3: Calculate Using Simple Divide Method

The Simple Divide Method is a great way of easily calculating ratios on Excel. Follow the steps given below to calculate the ratios without trouble.

Step 1: Enter Formula

• Use the same table to calculate ratios with this method.
• Using B2 and C2, enter the formula in D2.
• Formula: =B2/C2&”:”&”1″
• Click ‘Enter’
• You will find the final result in D2

Step 2: Calculate for All Cells

• Select the cell and drag your cursor downward to calculate the ratio for all the cells.

Tip: However, as seen in Row 4 and Row 6- the ratio is a big number post decimal. For this, we can use Round method as explained below.

## Method 4: Calculate Using Round Method

The Round Method is used to round a number to a specified number of digits. Let’s take a look at calculating ratios with the Round method.

Step 1: Enter the Formula

• In the table, select cells B2 and C2.
• Enter the formula in D2
• Formula: =ROUND(B2/C2,1)
• Click ‘Enter’
• You will get the final result as 2.5

Select the cells and drag your cursor downward to calculate the ratio for all the cells

Step 2: Convert the division into ratio

• Select cell D2
• Enter the formula: =D2&”:”&”1″
• Click ‘Enter’
• You will get final result as 2.5:1

Select the cells and drag your cursor downward to calculate the ratio for all the cells

Things to remember while using these methods:

Method 1: Create Ratio with GCD: A simplified and precise method of calculating ratios, can be visually appealing and easier to interpret

Method 2: Create Ratio with Text Function: Allows you to create ratios directly in text formatting, which can be useful for generating reports or presenting data

Method 3: Calculate Using Simple Divide Method: It is straightforward and easy to understand, however, may require additional formatting to manage decimal places

Method 4: Calculate Using Round Method: This method helps in rounding the ratios to specific decimal places providing a cleaner representation, however, rounding the ratio may introduce slight inaccuracies, especially if precision is reduced significantly. Hence, you have to be careful in rounding the ratios.

Consider these points to choose the most suitable method for your specific needs and preferences when calculating ratios in Excel.

Accuracy and Precision: Consider the level of accuracy and precision required for your analysis. Some methods, like the GCD method, provide more precise results, while others, like the Round method, allow for controlled precision.

Data Size and Complexity: Evaluate the size and complexity of your dataset. Some methods may be more efficient for handling large datasets, while others may be better suited for specific calculations involving complex ratios.

Reporting Format: Consider the desired format of your final output. If presenting ratios as text in a report is essential, the Text Function method might be suitable. However, if precise numerical values are required for further calculations, other methods might be more appropriate.

Ease of Use: Choose a method that aligns with your Excel proficiency. While some methods may offer more precise results, they might require a better understanding of Excel functions.

A ratio is a valuable tool for comparing the sizes of two or more quantities with each other. It enables measuring and expressing these quantities in an easier way for interpretation.

We hope you have understood the nitty-gritty of calculating ratios in Excel conveniently. With these methods, you can calculate ratios quickly. By understanding the concept of ratios and leveraging the power of Excel, you can efficiently perform ratio calculations and gain valuable insights from your data. Just try out the formulas and get your game on!

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