What was the reported lease expenses for Bb.Q Chicken in 2022?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company leases certain office space, restaurant site, vehicles and equipment. The Company assessed whether an arrangement qualifies as a lease (conveys the right to control the use of identified asset for a period of time in exchange for consideration) at inception and only reassesses its determination if the terms and conditions of the arrangement are changed. Lease with an initial term of 12 months or less are not recorded on the balance sheet. Lease expense is recognized for these leases on a straight-line basis over the lease term.
Certain leases include one or more options to renew, with renewal terms that can extend the lease term from one to 10 years or more. The excise of lease renewal options is at the Company's sole discretion.
Operating leases are included in operating lease right-of-use ("ROU") assets, other current liabilities, and operating lease liabilities in our balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in balance sheets. The Company does not have finance lease as of December 31, 2023.
Source: Item 23 — RECEIPTS (FDD pages 62–283)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, the company leases office space, restaurant sites, vehicles, and equipment. The document states that for the year ended December 31, 2022, the company recognizes lease expenses for leases with an initial term of 12 months or less on a straight-line basis over the lease term.
Note 9 in the FDD provides information on lease commitments. It indicates that the company assesses whether an arrangement qualifies as a lease at inception and only reassesses if the terms and conditions change. Certain leases may include options to renew, potentially extending the lease term from one to ten years or more, with the exercise of these options at the company's discretion.
The FDD does not specify the exact total lease expenses for 2022. However, it does mention that operating leases are included in operating lease right-of-use assets, other current liabilities, and operating lease liabilities in the company's balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in balance sheets, but the company did not have any finance leases as of December 31, 2023. To obtain the specific lease expenses for 2022, a prospective franchisee should consider requesting this information from Bb.Q Chicken.