1. The statement of cash flows, or the cash flow statement, is a financial statement that summarizes the amount of cash and cash equivalents entering and leaving a company. The cash flow statement (CFS) measures how well a company manages its cash position, meaning how well the company generates cash to pay its debt obligations and fund its operating expenses. You are financial manager of GALAXY plc and you need to prepare the cash flow statement for your stakeholders. To prepare cash flow statement, required information (Statement of Financial Position and Statement of Profit or Loss) are presented detailed in the following. Study the following balance sheets of GALAXY plc, and profit and loss account for the year ended 31 May, Year 2021. GALAXY plc Statement of Financial Position as at 31 May, 2021. Year, 2020 Year, 2021 ($) Non-Current Assets: ($) ($) ($) ($) Fixed Assets (Cost) 180,000 260,000 Depreciation 40,000 60,000 140,000 200,000 Investment (Cost) 10,000 5,000 150,000 205,000 Current Assets: Stock 50,000 60,000 Debtors 30,000 47,000 Banks 10,000 18,000 90,000 125,000 Total Assets 240,000 330.000 Long-Term Liabilities Debentures 0 50,000 Current Liabilities Creditors 17,000 18,000 Provision for tax 16,000 18,000 Provision for dividends 12,000 14,000 45,000 50,000 Total Liabilities 45,000 100,000 Equity or Capital Ordinary shares 170,000 200,000 Share premium account 17,000 20,000 Retained earnings (B/F) 8,000 10,000 195,000 230,000 Total Liabilities and Equity 240,000 330.000 GALAXY plc Statement of Profit or Loss Year ended 31 May, 2021 $ Operating Profit 30,000 + Profit on investment 4,000 34,000 (-) Provision for taxation (18,000) 16,000 + Retained earnings B/F 31/5/2020 8,000 24,000 (-) Provision for dividends (14,000) Retained earnings C/F 31/5/2021 10.000 GALAXY plc Statement of Profit or Loss Year ended 31 May, 2021 $ Operating Profit 30,000 + Profit on investment 4,000 34,000 (-) Provision for taxation (18,000) 16,000 + Retained earnings B/F 31/5/2020 8,000 24,000 (-) Provision for dividends (14,000) Retained earnings C/F 31/5/2021 10.000 ***Note: No tangible fixed assets were disposed of during the year but $5,000 of investment had been sold for $9,000.*** Required 1. The reconciliation of profit for operations to net cash from operating activities for the year ended 31 May, 2021. 2. Prepare a Statement of Cash Flows for the year ended 31 May, 2021. 3. If you were financial manager of GALAXY plc, what benefit will you get from preparation and interpretation of data received from cash flow statement? 4. From cash flow statement, which decision should you make for GALAXY plc. 5. You need to explain to top managers why your company prepares a cash flow statement in addition to an income statement and the statement of financial position annually