answer =850*77.1 formula in excel 2007 is 100000 , WHY?

That, my friend, is a bug... plain and simple. It looks like it requires
floating point numbers, where at least one of the numbers is a constant, to
trigger it; but not all combination bring out the bug. For example,
=8500*7.71 will not produce it whereas 450*154.2 will. If you put these
numbers (or the ones you posted originally) into cells, say A1=850 and
B1=77.1, then =A1*B1 does not produce the bug... at least one of numbers
being multiplied appears to have to be a constant... =A1*77.1 does produce
the bug. Oh, and the reason I said it requires floating point numbers is
because =85*771 returns the correct answer. By the way, everyone of the
above products has 65535 as the "proper" answer; and, of course, this value
is =2^16-1 (which does not produce the bug), and which is the largest signed
16-bit value.

Rick