What is the purpose of a formula in a spreadsheet application?

The purpose of a formula in a spreadsheet application is primarily to calculate values. Formulas consist of mathematical expressions that can perform calculations using numbers, cell references, and operators. For example, users can configure a formula to sum a range of cells, find an average, or calculate percentages, making it a powerful tool for data analysis and financial modeling. This calculation ability enables users to manipulate and analyze data effectively, allowing for dynamic updates when data changes.

While other options such as creating graphics, storing data, and formatting text are important features of spreadsheet applications, they do not pertain to the specific functionality that formulas provide. Formulas are intrinsically designed to execute calculations, ensuring that users can obtain real-time results based on the data available in their spreadsheets.