The purpose of the sources and uses table is to calculate how much equity the sponsor needs to put in for the purpose of calculating returns later on.
We start by calculating total uses, which represents how much money will be spent in acquiring the company as well as paying for transaction and financing fees.
Once we calculate how much money will be used in the transaction, we can calculate how to raise this money by calculating the sources of capital. Debt is usually calculated as a multiple of EBITDA, typically between 4 -6x LTM EBITDA. The rest of the funds must be provided by equity. Often, this equity is split between the sponsor (PE) and management rollover, with management taking 5-20% of the required equity and the sponsor taking the rest.