Mr. Abdul Ahad, the Financial manager of Tagdum-Tagdum Company received a requisition for Tk.400,000 from the operations department to complete the next production cycle. Before approving the money, Mr. Ahad wanted to ensure that the amount was sufficient to cover the cycle. Accordingly, he asked you to do the necessary exercises to estimate the financing requirement of the operation department. As an initial step toward carrying out your assignment, you decided to inspect the company's balance sheet and income statement for the last year (exhibit 1) Exhibit 1: Balance sheet and income statement of Tagdum-Tagdum Company for 2019 Assets Cash and equivalents Accounts Receivable Inventory Total current assets Net plant and equipment. Total assets Liabilities and Equity Accounts payable Accruals Notes Payable Total current liabilities Long-term bonds Total liabilities Common stock (25 million shares) Retained earnings Total common equity Total liabilities and equity Tagdum-Tagdum Company Balance Sheet on 31 December, 2019. Tk. Net sales Cost of goods sold Gross profit Fixed operating cost except depreciation Depreciation expense Interest expense Earnings before taxes Taxes @ 40% Total operating expenses Earnings before interest and taxes Earnings after taxes Preferred dividends Tagdum-Tagdum Company Income Statement for 2019 15,000,000 180,000,000 270,000,000 Earnings available to common stockholders Common dividends Addition to retained earnings. Tk. 30,000,000 60,000,000 40,000,000 130,000,000 285,000,000 Tk. 1,500,000,000 1,230,000,000 90,000,000 50,000,000 Tk. 465,000,000 380,000,000 845,000,000 Tk. 130,000,000 300,000,000 430,000,000 415,000,000 845,000,000 Tk. 270,000,000 140,000,000 130,000,000 40,000,000 90,000,000 36,000,000 54,000,000 54,000,000 29,000,000 25,000,000 Based on the last three years information, you have found that on an average, 80 percent of annual cost of goods sold have been incurred on account of labour and material cost. Based on your calculations, do you think that the financing requirement placed by the operations department is justified? Do you have any observation of the company's working capital management practice? Explain.