Cell references in equations and formulas take everything within a cell and places that value into a formula. Absolute cell reference is when the user takes a cell reference and places a dollar sign ($) in front of either the row, column, or both.

This symbol is meant to isolate whatever is after it. We can identify what the symbol does by looking at the letter after it! Here are the four ways cells can appear:

A4 – relative cell reference. This reference is the green light, it can go wherever it wants.

$A4 – Column A is isolated. This reference is a yellow light, there is some caution necessary.

A$4 – Row 4 is isolated. This reference is also a yellow light, there is some caution necessary.

$A$4 – This cell is absolute. This is the red light, it will not move at all.

Why is this helpful?

Isolate a row or column is helpful when you have a big table that has to be multiplied by a single cell. For example, if you were to add a tax rate to a sales table, instead of adding the tax rate to the entire table…cell by cell… row by row, you could simply add the absolute cell reference to the Tax rate cell and then add in a formula.