What was the deferred revenue at the beginning of 2023 for Bananas Smoothies Frozen Yogurt?
Bananas_Smoothies_Frozen_Yogurt Franchise · 2025 FDDAnswer from 2025 FDD Document
71,085 | | Total point in time | 639,691 | 704,017 | 748,225 | | Over time: | 13,583 | 13,584 | 15,527 | | Franchise fees | | | | | Total revenues | $ 653,274 | $ 717,601 | $ 763,752 |
NOTE 3. REVENUES AND RELATED CONTRACT BALANCES (CONTINUED)
Contract balances
Contract liabilities are comprised of un
Source: Item 23 — RECEIPT (FDD pages 58–231)
What This Means (2025 FDD)
According to the 2025 FDD, Bananas Smoothies Frozen Yogurt's deferred revenue at the beginning of 2023 was $50,983. This figure represents revenues that Bananas Smoothies Frozen Yogurt has received but not yet earned as of that date. In the case of a franchise, this often includes initial franchise fees that are recognized over time as the franchise provides services and support to the franchisee.
Deferred revenue is a liability on Bananas Smoothies Frozen Yogurt's balance sheet, reflecting their obligation to provide future services or fulfill certain conditions to earn the revenue. The decrease in deferred revenue from the beginning to the end of the period indicates that Bananas Smoothies Frozen Yogurt recognized a portion of this revenue during 2023, as they fulfilled their obligations to franchisees. Specifically, they recognized $13,584 in revenue during the period.
For a prospective Bananas Smoothies Frozen Yogurt franchisee, this information provides insight into the financial practices of the franchisor. A healthy deferred revenue balance can indicate a strong pipeline of new franchise agreements and initial fees, while the rate at which deferred revenue is recognized can reflect the ongoing services and support provided to franchisees. It's important to consider these figures in conjunction with other financial metrics to assess the overall financial health and stability of Bananas Smoothies Frozen Yogurt.