What was the net value of 7 Brew's property and equipment?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
6,454) | | (2,173,233) |
Note 2: Property and Equipment
Property and equipment, net consists of the following:
| Computers and software | $ | 338,722 | $ | 51,871 | $ | 40,581 |
|---|---|---|---|---|---|---|
| Leasehold improvements | 5,606 | - | - | |||
| Furniture and office equipment | 35,535 | 20,000 | 20,000 | |||
| Construction in progress | 23,876 | 6 | - | |||
| Software in development | 471,549 | 555,000 | - | |||
| Property and equipment, gross | 875,288 | 626,871 | 60,581 | |||
| Accumulated depreciation and amo |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 82)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, the net value of property and equipment for the years 2022, 2023, and 2024 are detailed in the balance sheets. As of December 29, 2024, the net value of 7 Brew's property and equipment was $791,000. Prior to this, on December 31, 2023, the net value was $597,821, and on December 25, 2022, it was $51,174.
These figures represent the depreciated value of 7 Brew's assets such as computers, software, furniture, and office equipment. Depreciation is an accounting method of allocating the cost of an asset over its useful life, reflecting the wear and tear or obsolescence of these items. The company uses a straight-line depreciation method, meaning the cost of the asset is evenly spread over its estimated useful life. For instance, computers and software are depreciated over 3 to 5 years, while furniture and office equipment are depreciated over 5 to 10 years.
For a prospective franchisee, understanding these values and depreciation methods is important for assessing the financial health and capital expenditure requirements of 7 Brew. Note 2 within the FDD further clarifies the composition of property and equipment, net. Reviewing these figures helps potential franchisees understand how 7 Brew manages its assets and accounts for their depreciation, which can influence the company's profitability and tax obligations. Additionally, the company capitalizes costs associated with the acquisition and development of major software for internal use and amortizes the assets over the expected life of the software.