What was the note receivable from a shareholder for B Bops as of December 31, 2023?

According to B Bops's 2025 Franchise Disclosure Document, the note receivable from the sole shareholder was $132,338 as of December 31, 2023. The FDD also provides the note receivable amounts for other years: $194,917 for the year ended December 31, 2024, $129,116 for the year ended December 31, 2022, and $125,973 for the year ended December 31, 2021.

This "note receivable" represents money owed to B Bops Franchising Corp. by its sole shareholder. The fact that this debt is outstanding for multiple years could indicate different things. It may be a long-term loan, or it could reflect ongoing transactions between the company and its shareholder. The FDD specifies that no payments are expected to be made within one year of the financial statement date.

Additionally, the FDD notes that B Bops earned interest income related to this receivable. The interest income was $3,222 for the year ended December 31, 2023. This detail confirms that the receivable is indeed a loan or similar credit arrangement on which B Bops is earning interest. A prospective franchisee should consider the related-party transactions when evaluating the financial health of B Bops.

It is important to note that such related-party transactions are not inherently problematic, but they do warrant careful scrutiny. A potential franchisee might want to inquire about the nature of this receivable, the repayment terms, and the reasons why the shareholder has borrowed such a significant amount from the company. Understanding these details will provide a clearer picture of B Bops's financial management and its relationship with its shareholder.