What depreciation method does All County use for property and equipment?
All_County Franchise · 2025 FDDAnswer from 2025 FDD Document
Property and Equipment are recorded at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of individual assets. The Company holds office and computer equipment with estimated useful lives of 5 to 7 years.
Maintenance and repairs are expensed as incurred. Major renewals and improvements are capitalized. Upon sale or retirement, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in operations.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to All County's 2025 Franchise Disclosure Document, the company uses the straight-line method to calculate depreciation for property and equipment. This method is applied over the estimated useful lives of the individual assets, with office and computer equipment having estimated useful lives of 5 to 7 years.
For a prospective All County franchisee, understanding the depreciation method is important for financial planning and tax purposes. The straight-line method evenly distributes the cost of an asset over its useful life, providing a consistent depreciation expense each year. This can help in forecasting expenses and understanding the tax implications related to asset depreciation.
Additionally, the FDD states that maintenance and repairs are expensed as incurred, while major renewals and improvements are capitalized. Upon the sale or retirement of an asset, All County removes the cost and related accumulated depreciation from the accounts, and any resulting gain or loss is included in operations. This accounting practice ensures that the financial statements accurately reflect the value of the assets and any gains or losses realized upon their disposal.