What was the amount of interest accrued for B Bops in 2023?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
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B-Bop's Franchising Corp. has a receivable from the sole shareholder in the amount of $194,917 for the year ended December 31, 2024, $132,338 for the year ended December 31, 2023, $129,116 for the year ended December 31, 2022, and $125,973 for the year ended December 31, 2021. No payments are expected to be made within one year of the financial statement date.
Interest income related to the receivable above was $4,758 for the year ended December 31, 2024, $3,222 for the year ended December 31, 2023, $3,144 for the year ended December 31, 2022, and $3,506 for the year ended Decemb
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 52–53)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, interest income related to a receivable from the sole shareholder was $3,222 for the year ended December 31, 2023. This interest income is tied to a receivable from the sole shareholder, which was $132,338 for the same period.
This indicates that B Bops has a financial relationship with its sole shareholder, where the shareholder owes the company a significant amount of money. The interest accrued on this debt contributes to B Bops's income. The fact that this receivable is not expected to be paid within one year suggests it is a long-term arrangement.
For a prospective franchisee, this related-party transaction highlights the importance of understanding the financial relationships between B Bops and its principals. While not inherently negative, it is crucial to assess how such transactions might affect the company's financial stability and decision-making. Reviewing the complete financial statements and asking detailed questions about these related-party transactions during due diligence is advisable.