What was the depreciation expense for Beef O Bradys for the year ended December 31, 2023?
Beef_O_Bradys Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2023 | 2022 | |
|---|---|---|
| $ 1,413,977 | $ | 1,270,377 |
| 6,957,111 | 6,291,623 | |
| 11,216,267 | 10,425,857 | |
| 19,587,355 | 17,987,857 | |
| (11,9 |
Source: Item 23 — RECEIPTS. (FDD pages 66–330)
What This Means (2025 FDD)
According to Beef O Bradys's 2025 Franchise Disclosure Document, the depreciation expense for the years ending December 31, 2023, was $2,734,361, while in 2022, it was $2,605,007.
Depreciation expense represents the allocation of the cost of tangible assets, such as buildings and equipment, over their useful lives. This accounting practice reflects the gradual decline in the value of these assets as they are used in the business operations of Beef O Bradys.
For a prospective franchisee, understanding depreciation expense is crucial as it impacts the overall profitability and financial health of the franchise. Higher depreciation expenses can reduce net income, which may affect the franchisee's ability to secure financing or attract investors. Conversely, it can also provide tax benefits, as depreciation is a deductible expense.
The difference in depreciation expense between 2022 and 2023 could be due to several factors, such as the acquisition of new assets, changes in depreciation methods, or adjustments to the estimated useful lives of existing assets. Franchisees should consult with financial advisors to fully understand the implications of depreciation expense on their investment.