What was the total property and equipment value for 360 Painting in 2024 before accounting for accumulated depreciation and amortization?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
3,690 | 1,324,609 | | Prepaid commissions | 1,118,849 | 985,918 | | Other current assets | 75,000 | 161,345 | | Total prepaid expenses and other current assets | $ 3,666,212 | $ 2,486,419 |
5. Property and Equipment
Property and equipment consisted of the following as of December 31, 2024 and 2023:
| Useful Life | 2024 | 2023 | |
|---|---|---|---|
| Office equipment | 3 – 5 years | $ 387,762 | $ 224,403 |
| Software for internal use | 1 – 2 years | 873,991 | 687 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 56)
What This Means (2025 FDD)
According to 360 Painting's 2025 Franchise Disclosure Document, the total property and equipment value in 2024, before accounting for accumulated depreciation and amortization, was $1,541,230. This figure represents the original cost of assets like office equipment, software, and leasehold improvements that 360 Painting owned and used in its operations during that year. These assets have varying useful lives, ranging from 1 to 5 years, over which they are depreciated.
For a prospective franchisee, understanding the gross value of property and equipment can provide insights into the scale of investment 360 Painting makes in its infrastructure. It also highlights the types of assets the company relies on to support its franchise operations. Knowing the useful lives of these assets helps in forecasting potential capital expenditure needs for maintaining or replacing them over time.
However, it's important to note that this figure does not reflect the net book value of these assets, which is the original cost less accumulated depreciation. The net value, which accounts for depreciation, is reported as $762,462 for 2024. Depreciation and amortization are accounting methods used to allocate the cost of an asset over its useful life, reflecting the gradual decline in its value due to wear and tear or obsolescence.
Therefore, while the total property and equipment before depreciation gives a sense of the initial investment, the net value provides a more accurate picture of the assets' current worth. Reviewing both figures, along with the depreciation methods used, can offer a more comprehensive understanding of 360 Painting's asset management and financial health.