What taxes does Aplus exclude from the measurement of transaction price?

According to Aplus's 2024 Franchise Disclosure Document, Aplus has elected to exclude specific taxes from the measurement of transaction price. These taxes are those assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction. Aplus collects these taxes from customers.

Examples of the types of taxes Aplus excludes from the transaction price include sales tax and value-added tax (VAT). This means that when Aplus calculates its revenue, it does not include the amounts it collects for these specific taxes. Instead, it only includes the actual price of the goods or services sold, excluding the tax portion.

For a prospective Aplus franchisee, this accounting practice affects how revenue and related financial metrics are reported. Franchisees should be aware that the reported revenue figures will not include these collected taxes, which could impact their understanding of the store's financial performance if they are not careful. It is important to understand how Aplus accounts for these taxes to accurately assess the financial health of the franchise.