What was the current portion of deferred revenue for 1-800-GOT-JUNK? as of December 31, 2024?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
Current liabilities: Accounts payable and accrued liabilities $ 7,092,682 $ 4,138,456 Payable to franchisees
4,516,725 13,842,336 Current portion of deferred revenue
473,059 521,102 Due to related parties 11,846,841 8,910,939 Withholding tax payable
258,110 165,380
Source: Item 21 — Financial Statements (FDD page 56)
What This Means (2025 FDD)
According to 1-800-GOT-JUNK?'s 2025 Franchise Disclosure Document, the current portion of deferred revenue as of December 31, 2024, was $473,059. This figure represents the amount of revenue that 1-800-GOT-JUNK? has received but not yet earned, and which is expected to be recognized as revenue within the next year. This deferred revenue likely stems from franchise fees, renewal fees, or territory expansion fees that are recognized over the term of the franchise agreement.
For a prospective 1-800-GOT-JUNK? franchisee, understanding deferred revenue is crucial because it reflects the company's financial obligations to provide future services or benefits. A higher deferred revenue balance might indicate strong future revenue streams, but it also signifies a liability that 1-800-GOT-JUNK? must fulfill. The current portion specifically highlights the short-term obligations related to these deferred amounts.
The deferred revenue is recognized ratably over the related term of the franchise agreement. This accounting practice ensures that revenue is matched with the delivery of services or rights granted to franchisees over time. The notes to the consolidated financial statements provide additional context on the revenue recognition policies and the nature of deferred revenue, offering further insights into 1-800-GOT-JUNK?'s financial health and stability.