What is the significance of Aunt Millies Bakeries being taxed as an S Corporation?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Reporting Entity: The consolidated financial statements contain the accounts of Perfection Bakeries, Inc., Perfection Distribution LLC, Perfection Associates LLC, and First Capital Acceptance Corporation, (collectively, the "Company") which operate under common management and are of common ownership. Perfection Distribution LLC, Perfection Associates LLC, and First Capital Acceptance Corp., are all 100% wholly owned subsidiaries of Perfection Bakeries, Inc. Perfection Bakeries, Inc. produces and distributes various bread, bun and bakery products throughout the Midwest, predominantly in Indiana, Michigan, Illinois, Kentucky, Wisconsin, and Ohio. The Company also sells its product nationally and internationally through its Bakehouse division, which is the Company's frozen baked goods division, representing approximately 23% and 21% of the Company's total net sales for the years ended September 30, 2024 and 2023, respectively. Perfection Distribution LLC operates as the transportation distribution function for Perfection Bakeries, Inc. as a "carrier for hire" and results in maximizing savings related to sales and use tax. Effective December 1, 2023, Perfection Bakeries, Inc. and Perfection Associates LLC entered into an agreement and plan of merger Perfection Associates LLC merged with and into Perfection Bakeries, Inc. Prior to December 1, 2023, Perfection Associates LLC functioned as an employee leasing company, which leases employees back to Perfection Bakeries, Inc. and Perfection Distribution LLC. First Capital Acceptance Corporation serves as the finance company for the routes that are sold to independent distributors (see Note 4).
All significant intercompany account balances and transactions have been eliminated in the consolidated financial statements.
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, Aunt Millies Bakeries operates as Perfection Bakeries, Inc., along with its subsidiaries. Note 1 of the document states that the consolidated financial statements include Perfection Bakeries, Inc., Perfection Distribution LLC, Perfection Associates LLC, and First Capital Acceptance Corporation. All these entities operate under common management and ownership. The FDD specifies that Perfection Distribution LLC, Perfection Associates LLC, and First Capital Acceptance Corp. are wholly-owned subsidiaries of Perfection Bakeries, Inc.
The document does not explicitly state that Aunt Millies Bakeries is taxed as an S corporation. However, it does provide information about the company's structure and operations, including its subsidiaries and their functions. This information is useful for understanding the overall financial structure of Aunt Millies Bakeries.
To determine the tax status of Aunt Millies Bakeries, a prospective franchisee should directly ask the franchisor about its tax structure and how it might affect franchisees. Understanding the tax implications is crucial for making informed financial decisions related to the franchise.