Vintage Peugeot conversion help and tips please

Noob question - I just bought a wheelset complete with sprocket. Now the sprocket has a flange on it - is this meant to face the middle of the wheel or out towards the locknut?

I know this might be obvious once I try and put it together but I'm sat at work trying to work out my chainline and order a BB for the weekend and I can't really get the whole wheelset out and start tinkering with it without everyone realising I'm blatantly slacking.

Cheers all.

That's flange is...leverage.

Fit your chain and find out what I mean.