Up to what amount are Bang Cookies' U.S. noninterest-bearing transaction accounts insured by the Federal Deposit Insurance Corporation (FDIC)?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
valuated the impact of this standard on its financial statements and determined that it doesn't have any lease that meet the requirement to recognize a right-of-use asset and liability because the Company doesn't have any long-term leases.
**3. CASH AND CAS
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies' 2024 Franchise Disclosure Document, the company maintains its cash balance in U.S. noninterest-bearing transaction accounts. These accounts are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000.
This means that Bang Cookies' cash holdings in these specific accounts are protected by the FDIC up to the stated limit. Should the bank holding the funds fail, the FDIC would reimburse Bang Cookies for any losses up to $250,000. However, the FDD notes that as of December 31, 2023, Bang Cookies' cash balance might have exceeded the FDIC insurance limits.
For a prospective Bang Cookies franchisee, this information is relevant in assessing the financial security and risk management practices of the company. While the FDIC insurance provides a safety net, it's important to note that amounts exceeding the $250,000 limit would not be insured. Franchisees may want to inquire about Bang Cookies' strategy for managing cash balances to ensure they are adequately protected, especially if balances routinely surpass the FDIC coverage limit.