What was the amount of the intangible asset for 1-800-GOT-JUNK? as of May 31, 2025?

According to 1-800-GOT-JUNK?'s 2025 Franchise Disclosure Document, as of May 31, 2025, the net book value of the intangible asset, which is a diversion reporting application, was $89,680. The original cost of the asset was $89,680, and there was no accumulated amortization at that time, resulting in the net book value matching the initial cost.

It is important to note that the intangible asset was not yet in use as of May 31, 2025. This means that 1-800-GOT-JUNK? had invested in developing this asset, but it had not yet been implemented or generating revenue. The FDD also includes information about the accounting policies related to intangible assets, stating that costs directly attributable to internally developed software are recognized as an intangible asset if certain requirements are met, such as the ability to reliably measure development costs and the project being technically and commercially feasible.

The amortization rate for developed software is 33%, but since the asset was not in use as of May 31, 2025, no amortization had been recorded. For a prospective franchisee, this indicates that 1-800-GOT-JUNK? is investing in technology and software development, which could potentially benefit franchisees in the future once the asset is deployed and generating economic benefits.

It's worth noting that the financial statements included in the FDD are unaudited for the period ended May 31, 2025. While this doesn't necessarily indicate a problem, prospective franchisees should be aware that the figures have not been verified by an independent certified public accountant. The audited financial statements as of December 31, 2024, December 31, 2023, and December 31, 2022, are also included in the FDD as Exhibit E.