Company and Industry Background

$1.$ What does Sleep Number Corporation do$?$ What industry does it compete in$?$ What are the

core brands under the Sleep Number umbrella?

$2.$ What world and economic event$($s$)$ have impacted Sleep Number$’$s performance? What actions

did Sleep Number take to address the challenges?

$3.$ Name two brands that are competitors of Sleep Number products.

$4.$ Name two competitive factors that Sleep Number lists as important drivers to its success.

Sleep Number Financial Performance

$5.$ What is the percentage change in total net sales from $2022$ to $2023?$  What does Sleep Number

attribute most of this change to$?$ 

$6.$ What is Sleep Number$’$s largest expense in $2023,$ and how much was it$?$  How did that

expense change from $2022$ to $2023?$ 

$7.$ What does the Warranty Liability represent? How much is it at the end of $2023?$ How does

Sleep Number estimate this liability? Describe how this liability represents the economics,

incentives, and errors found in most accounting numbers.

$8.$ What is the book value of equity at the end of fiscal year $2023?$  What is Sleep Number$’$s

retained earnings at the end of fiscal year $2023?$ What impacted retained earnings during

$2023?$ 

$9.$ What do Restructuring Costs relate to$?$ How much was incurred during $2023?$ 

$10.$ How has Sleep Number$’$s performance changed over the years. What prompted the

restructuring? $($Note: you might have to look at old financial statements to answer this

thoroughly$)$ 

Financial Statement Analysis

$11.$ Discuss Sleep Number$’$s $2023$ profitability. Use any ratios and other financial information you

deem appropriate. A good answer will not simply report values but will also evaluate Sleep

Number$’$s performance using benchmarks $($over time and across firms$)$ and explain the drivers

of that performance.

$12.$ Assess Sleep Number$’$s $2023$ cash flow statement, focusing on the most salient components.

Also, evaluate the company$’$s liquidity and ability to manage cash efficiently. What risks does

the cash flow statement highlight. How does Sleep Number$’$s management describe its

position on those risks?

$13.$ Discuss Sleep Number$’$s leverage and comment on factors that influence Sleep Number$’$s

credit analysis. Use any ratios or other information you deem appropriate.