What was the reported operating lease expense for Ben Jerrys in 2023?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
| BEN & JERRY'S FRANCHISING, INC. AND SUBSIDIARY | ||
|---|---|---|
| Consolidated Statements of Cash Flows | ||
| (In Thousands) | ||
| 2023 | 2022 | |
| Cash flows from operating activities: | ||
| Net profit (loss) from operations | 1,161 | (258) |
| Adjustments to reconcile net profit (loss) to net | ||
| cash provided by operating activities: | ||
| Allowance for (recovery of) credit losses | 1 | (61) |
| Depreciation and amortization | 152 | 152 |
| Interest on financing lease | - | (1) |
| Amortization of right of use asset, operating | 77 | 77 |
| Amortization of right of use asset, financing | 36 | 37 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 89–133)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, the amortization of the right-of-use asset related to operating leases was $77,000 in 2023. This figure appears in the Consolidated Statements of Cash Flows, under adjustments to reconcile net profit to net cash provided by operating activities.
This amortization represents the expense recognized during the year for the use of leased assets under operating lease agreements. For a potential franchisee, this indicates that Ben Jerrys recognizes and accounts for operating leases, which are common for retail locations. The right-of-use asset represents the franchisee's right to use an asset for the lease term.
The FDD also states that as of December 31, 2023, the weighted average discount rate of outstanding operating leases was 2.3%. This rate is used to calculate the present value of lease payments when the lease liability and right-of-use asset are initially recognized. Understanding these lease accounting practices is crucial for franchisees as lease expenses can significantly impact their financial performance.