What was the accumulated deficit for Afuri Ramen Dumpling as of December 31, 2021?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
| | Credit for income taxes | (18,834) | | Net income | $ 8,159 |
| 70.1 | mmon tock | 1000 | dditional -in-Capital | Ac | cumulated Deficit | Total | ||
|---|---|---|---|---|---|---|---|---|
| Balance at December 31, 2021 | S | 4.0 | $ | 18,000 | S | (14,524) | S | 3,476 |
| Net Income | - | 8, |
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, the accumulated deficit as of December 31, 2021, was $(14,524). This figure represents the total losses Afuri Ramen Dumpling has incurred since its inception, which have not yet been offset by profits.
For a prospective franchisee, an accumulated deficit indicates that the company has been operating at a loss. However, in the subsequent year, the deficit decreased to $(6,365), suggesting improved financial performance. This improvement was driven by a net income of $8,159 during the year.
It's important for potential franchisees to consider the trend of the accumulated deficit and net income. While the initial deficit might raise concerns, the subsequent reduction and positive net income could signal a turnaround. Further investigation into the company's financial statements and business plan is advisable to assess the sustainability of this trend.