This workout gets us to look at construction CapEx.

You can see that the construction CapEx is going to depreciate over five years. This is longer than the operation of the project, and that'll be important a bit later. You can see that the project is split up into two phases, construction followed by operation, and there will be no depreciation in the construction phase. In fact, there's no income statement at all. Everything is getting capitalized and it's awaiting the operation period where it's all gonna get released to the newly minted income statement. This means that the initial period is rather straightforward. We can build up a base, which means building up from the last year, and then we can build up the CapEx and then we can skip depreciation because there will be none. And that means that we can then sum everything above highlight, go to the right copy to the right, and we've got our ending balance of 300, and we're now gonna switch over to a new way of working.

You can see that there's no more CapEx.

Now we can actually still copy everything here to the right, and that's because there is no CapEx. And so it'll pick up no CapEx because they're just gaps. And it just saves us typing that out. Again, you can see the zeros here and that's because the base there is trying to fetch from over here and there's nothing there yet. So let's take these to the right as well.

And what appears to be happening now is absolutely nothing. And that's because we've got a big gap in depreciation, which we're gonna need to fill now. Now the way that this will depreciate is the starting amount, and we can point it to the ending balance or the starting amount. And if we lock that, we'll get depreciated over a number of years and let's lock that as well. And it's tempting to just grab that and say that will be the deduction every year. And that does work, but it will start to break down. And you can see it breaks down pretty much at year nine. And the reason is that if we count those up, 1, 2, 3, 4, 5, we've got the asset depreciating over five years quite nicely. But then it starts to kind of depreciate through the floor and we end up with this strange negative balance. So that won't work. And so let's backpedal a little bit and start that again. So what we've got to do is if we have to into it and wrap it in a min, we can say, okay, we'll go ahead and grab the depreciation if it's the lower of the two figures, or go and grab the opening balance if that's lower. And what that will do is if the opening balance is, for example, zero, it will go and grab that zero and stop depreciating. So I'll do that and then I'll just show my formula Here. And if you need a bit of time, maybe pause the recording and then what we'll do is we'll drag that to the right, see if it works, and it does work perfectly. You can see that by year five is depreciating down to zero and then stopping. So that min is pretty important. We could have simplified and just copied five years across, but it's probably better to do admin so that this is a nice flexible model.