How is the change in working capital calculated? May you please show a step by step. This shows increase in H, but I cant seem to figure out the calculation. Thank you!

Mini-Case Study: Capital Budgeting with Fresnel Lenses Fresnel Enterprises, Inc. is embarking on a new venture with a partner manufacturing company China. Fresnel has designed a new line of screen guards for smartphones that not only protect screens, but also act as a magnifying glass. They expect the new screen guards to be particularly popular with retirees in the United States, so are already planning a marketing campaign targeting the Florida and Arizona markets. However, while Fresnel can manage design, marketing, and distribution in the United States, they have little manufacturing expertise. So they have hired a contract manufacturer in China to handle actual production. Fresnel will supply the initial investment dollars needed to set up the production and assembly lines in China, and then pay their partner a modest fee for each unit produced. Since they are handling distribution, there will also be some working capital investments required. Fresnel is planning a 5 -year time horizon for this project. At the end of year 5 , the company will liquidate the assets from the project. All assets will have beer fully depreciated. A list of facts and assumptions, including sales forecasts for the life of the project, are given in the tables to the right. ========> \begin{tabular}{|c|c|c|c|c|c|c|c|} \hline Year, n & Llnkage & & 1 & 2 & 3 & 4 & 5 \\ \hline \multicolumn{8}{|l|}{ Part (a) } \\ \hline EBIT & E=A+B+C+D & & 67,499 & 192,502 & 322,503 & 290,004 & 62,505 \\ \hline Taxes & 21%E & & 14,175 & 40,425 & 67,726 & 60,901 & 13,126 \\ \hline Net Income & G=E+F & & 53,324 & 152,077 & 254,777 & 229,103 & 49,379 \\ \hline \multicolumn{8}{|l|}{ Part (b) } \\ \hline Working capital & H=21%A & 62,500 & 162,500 & 212,500 & 200,000 & 112,500 & - \\ \hline \begin{tabular}{l} Change in working c \\ apital \end{tabular} & \begin{tabular}{l} I= Increase in \\ H \end{tabular} & 62,500 & 100,000 & 50,000 & 12,500 & 87,500 & 112,500 \\ \hline \multicolumn{8}{|l|}{ Part (c) } \\ \hline \begin{tabular}{l} Initial cost of Equipm \\ ent \end{tabular} & J & 675,000 & & & & & \\ \hline \begin{tabular}{l} After- Tax salvage val \\ ue of Equipment \end{tabular} & K & & & & & & 65,000 \\ \hline Free cash flow & L=GD+I+J+K & 737,500 & 18,324 & 237,077 & 402,277 & 451,603 & 361,879 \\ \hline \multicolumn{8}{|l|}{ Part (d) } \\ \hline NPV & 213,810 & & & & & & \\ \hline IRR & 20.37% & & & & & & \\ \hlineBCR & 1.29 & & & & & & \\ \hline \end{tabular}