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Default Making the drop down list of a cell depend on another cell

I want to catagorise my spreadsheet entries, into seperate catagories eg:
Works/Services, Fundraising, Bar/Fridge, Misc, etc, with each of these
catagories having further classes inside them ie Fundraising contains:
Chocolates, Open Day, Donations etc. I want to do this so I can sort and
work out (using a pivot Table) income and expenses on each class.

Thanks for the Help, Jarrod
 
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