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When data is imported into Excel, it may contain extra spaces and characters causing issues. Excel has functions like Trim to clean up the data. By applying Trim to a list of movie titles, extra spaces between words are removed, and multiple spaces are replaced with a single space. Trim also eliminates spaces at the beginning and end of titles. Another issue can be line breaks in data, which can be resolved using the SUBSTITUTE function to replace line breaks with spaces. These functions help clean up and organize data in Excel efficiently.