For Bananas Smoothies Frozen Yogurt, what was the deferred revenue at the beginning of the period in 2023?
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 the period in 2023 was $50,983. Deferred revenue represents payments the company has received for goods or services that have not yet been fully earned or delivered. In the case of a franchise, this often relates to initial franchise fees that are recognized over time as the franchisee operates under the Bananas Smoothies Frozen Yogurt brand.
For a prospective franchisee, this figure provides insight into how Bananas Smoothies Frozen Yogurt accounts for its franchise fee revenue. A higher deferred revenue balance could indicate that a significant portion of the initial franchise fees are recognized over the term of the franchise agreement, which is a common practice in franchising. The corresponding revenue recognized during 2023 was ($13,584).
Understanding the deferred revenue and revenue recognition policies can help a franchisee assess the financial stability and accounting practices of Bananas Smoothies Frozen Yogurt. It's important to note that these figures reflect the company's overall financial reporting and may not directly correlate with an individual franchisee's performance or financial obligations.