Simulation is widely used in both accounting practice and auditing practice for a variety of types of problems. It is also utilized extensively in accounting education. Addressing the functional competencies in the AICPA Core Competency Framework for Entry into the Accounting Profession, AICPA states that individuals entering the accounting profession must be able to build appropriate models and simulations using electronic spreadsheets and other software. Developing and experimenting a simulation model on an electronic spreadsheet not only eliminates the need for learning a programming language and simplifies the model building process but also eases the experiments for different values of the parameters. This paper is organized as follows. At first, it provides a discussion of random number generators in the electronic spreadsheet environment. Next, it demonstrates the use of Microsoft Excel to develop two working simulation models without third-party add-ins.

This article is from the Accounting Instructors’ Report, an electronic journal that provides teaching tips and insights to those who teach accounting and other business courses.
V. Reddy Dondeti, Ph.D., Norfolk State University
Johnnie A. Mapp, Ph.D., Norfolk State University
Jim Chen, Ph.D.*, Norfolk State University


Read Spreadsheet Simulation in Accounting Without Add-ins.