Investment Appraisal

Hi John I dont understand how this example question of Kalpan answer works - please can you help? Q: A company is considering a new project that will require an initial investment of $60,000 and will generate contributions as Year 1 $20,000, Year 2 $15,000, Year 3 $25,000 and Year 4 $40,000. Working capital equal to 20% of the contribution needs to be in place at the start of each year. At a cost of capital of 10%, what is the NPV of the project to the nearest $50? A: t0 t1 t2 t3 t4 Investment (60,000) Contribution 20,000 15,000 25,000 40,000 Working capital (4,000) 1,000 (2,000) (3,000) 8,000 Net cashflow (64,000) 21,000 13,000 22,000 48,000 Discount factor 1.000 0.909 0.826 0.751 0.683 Present Value (64,000) 19,089 10,738 16,522 32,784 Net present value $15,133 I dont understand how the working capital of 20% of contribution is +1K in T1 then -2K and -3K in T2 and T3? But back to normal 20% of 40K (8K) in T4? Thanks!