What was the accrued warranty expense for Batteries Plus Bulbs in 2023?
Batteries_Plus_Bulbs Franchise · 2025 FDDAnswer from 2025 FDD Document
| LIABILITIES AND MEMBER'S EQUITY | |||
|---|---|---|---|
| Current liabilities | |||
| Accounts payable | $ 33,297 | $ 23,497 | |
| Accrued salaries and benefits | 3,618 | 7,046 | |
| Note payable - store repurchase | - | 930 | |
| Accrued warranty | 3,032 | 2,960 | |
| Other accrued expenses | 3,379 | 2,829 | |
| Due to franchisees | 380 | - | |
| Current portion of operating lease liabilities | 5,582 | 5,915 | |
| Current portion of finance lease liability | 44 | 100 | |
| Current portion of contract liability | 1,073 | 1,372 | |
| Total current liabilities | 50,405 | 44,649 |
Source: Item 23 — Receipts (FDD pages 80–279)
What This Means (2025 FDD)
According to Batteries Plus Bulbs's 2025 Franchise Disclosure Document, the accrued warranty expense for the company in 2023 was $3,032. This figure represents the estimated cost of fulfilling warranty obligations for products or services that Batteries Plus Bulbs provided. Accrued warranty is a liability account, reflecting the company's obligation to cover potential warranty claims.
For a prospective franchisee, understanding the accrued warranty expense is important as it provides insight into the potential liabilities the company faces related to product warranties. While franchisees may not directly deal with this specific corporate-level accounting, it reflects the overall quality and reliability of the products Batteries Plus Bulbs offers. A higher accrued warranty expense might indicate more frequent warranty claims, which could indirectly affect a franchisee's customer satisfaction and operational costs.
It's also worth noting the accrued warranty expense in the context of the company's overall financial health. In 2023, Batteries Plus Bulbs had total current liabilities of $50,405 and total assets of $429,937. The accrued warranty expense, therefore, represents a small fraction of the company's overall liabilities and assets, suggesting that warranty obligations are well-managed within the company's financial structure. Franchisees should consider these figures as part of their due diligence to assess the financial stability and risk associated with the franchise.