I know this may not be what you want to hear, but the Help files are really great for things like this. The only other thing you need to understand is that the inner-most parens are worked on first, so the MID function is calculated before the VALUE function. Another good tool is the formula auditor.
Converts a text string that represents a number to a number.
Text is the text enclosed in quotation marks or a reference to a cell containing the text you want to convert.
Text can be in any of the constant number, date, or time formats recognized by Microsoft Excel. If text is not in one of these formats, VALUE returns the #VALUE! error value.
You do not generally need to use the VALUE function in a formula because Excel automatically converts text to numbers as necessary. This function is provided for compatibility with other spreadsheet programs.