TB MC Qu. 20-69 (Algo) The inventory turnover ratio: The Sleep Company The Sleep Company had the following operating results for 2021-2022. In addition, the company paid dividends in both 2021 and 2022 of $70,800 per year and made capital expenditures in both years of $30,000 per year. The company's stock price in 2021 was $8 and $7 In 2022. The Industry average earnings multiple for the mattress Industry was 9 in 2022 and the free cash flow and sales multiples were 18 and 1.5, respectively. The company is publicly owned and has 1,600,000 shares of outstanding stock at the end of 2022. Balance Sheet, December 31, Cash Accounts Receivable Inventory Total Current Assets Long-lived Assets Total Assets Current Liabilities Long-term Debt Shareholder Equity Total Debt and Equity 2022 2021 $ 376,000 $ 136,000 $ 386,000 $ 436,000 $ 286,000 $ 336,000 $ 1,048,000 1,440,000 $ 2,488,000 $ 236,000 636,000 1,616,000 $ 2,488,000 Income Statement, for year ended December 31, Sales Cost of Sales 2022 $ 4,930,000 4,244,000 2021 $ 908,000 1,460,000 $ 2,368,000 $ 336,000 536,000 1,496,000 $ 2,368,000 $ 4,680,000 4,144,000 Gross Margin Operating Expenses Operating Income Taxes Net Income Cash Flow From Operations Net Income Plus Depreciation Expense 536,000 418,000 118,000 686,000 368,000 318,000 127,200 47,200 $ 190,800 $ 70,800 + Decrease (-increase) in Accounts Receivable and Inventory + Increase (-decrease) in Current Liabilities Cash Flow from Operations The Inventory turnover ratio for 2022 Is (rounded): 2022 $ 190,800 50,000 100,000 (-100,000) 2021 $ 70,800 50,000 $ 240,800 $ 120,800