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The extension is used to identify the file type and enable it to be opened by the right software. By having extensions we can also give files that are related the same name in different applications. So you could have a file for finances in a Word document called Finances.doc and one in Excel called Finances.xls too. You can also estimate the versions of the software that created the file. Up to Excel 2003 .xls was used and since Excel 2007 .xlsx has been used.

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What further describes the file contents and often lets you know which application can be used to open the file?

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