In this workout, we're going to complete the sources and uses of funds stable. We're given a VAT rate of 20%, cost of debt of 5%, and an equity financing assumption of 30%. And what this means is that the bank requires us to have 30% in equity finance. So let's begin with our uses of funds. We have our CapEx spend or hard costs, as well as other soft costs. So we can take our VAT rate of 20%, we can lock that in, multiply that times our total costs. So the sum of our soft and hard costs to compute our VAT in line 13. Now let's copy that to the right and let's move on to our next line. So our next line would be capitalized interests. However, we have to skip this calculation until we have calculated our debt financing below. So for now, we can simply calculate our total uses of funds as the sum of everything above, and we copy that to the right.

Now let's move on to our sources of funds. And we're gonna start with the equity financing source. And again, that's gonna be 30%.

We lock that in off the total uses of funds, that's gonna be 39.6 in year one. Let's copy that to the right. So next we can calculate the VAT facility. Now the bank will allow us to take out a loan specifically to pay the VAT, and then this loan gets repaid once we can claim the VAT back during the operational phase. So in this case, all we need to do is link our VAT facility to the VAT line in row 13. We copy that right. And finally we have a separate line for our debt facility, our standard loan or syndicated loan. And in this case, there's gonna be a balancing figure where we take the total uses of funds and we subtract everything else in our sources of funds. So we take out the VAT facility and we take out the equity finance that will give us 70.4 in year one. So let's copy this to the right. Now we can compute our total sources of funds by adding up the debt financing the VAT facility and the equity financing. And we copy that to the right.

So now we have one missing item and that's our capitalized interest. Now for simplicity, we're gonna assume that we're gonna pay interest on our beginning balance or our prior year balance. So for year two, we need to take the cost of debt of 5%.

We lock that in and we're gonna multiply times the sum of the debt facility and the VAT facility in year one, that's gonna give us 4.6.

And for year three, again, we take the 5% cost of debt. We lock that in and we multiply it times the sum of both the debt facility and the VAT facility for both years, years one, and years two combined. And that gives us 18.6. And you can see that our sources and uses of funds stable, it's balanced.