The account you use in Office can be a new or existing Microsoft account, or an account assigned to you by your work or school. Many people have both types. Which one you use depends what you're trying to do, but in most cases you need an account to:
Install and activate Office With many newer versions of Office, your account shows who the Office license belongs to. You use this account to sign in to Office on your devices.
Manage Office Sign in to office.com anytime you need to install or reinstall Office, update your security settings, account profile, and if you have a subscription, your payment and billing information.
Access your email and other cloud services You might also use this account to access your Outlook email, calendar, and contacts, or any files you saved to a Microsoft cloud-service such as OneDrive, Teams, or SharePoint.
Note : Office 365 apps do not support logging in with multiple user accounts from a same Microsoft 365 org or tenant at the same time. You need to log off from one user account to sign in with the other user account. If you don't do that, you will see the error documented in this article: Another account is already signed in computer when signing in to Office 2013 - Microsoft 365 Apps | Microsoft Learn