As of December 31, 2022 and 2021, what did Benihana's cash and cash equivalents consist of?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
nt date, other than quoted prices included in Level 1, either directly or indirectly. Valuations using Level 3 inputs are based on significant unobservable inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. There were no significant transfers between levels during any period presented.
Cash and Cash Equivalents
Cash and cash equivalents are defined as cash on hand and highly liquid instruments with original maturities of three months or less when purchased. The Company's cash and cash equivalents consist of cash in banks and at the restaurants as of December 31, 2021 and 2020.
Accounts Receivable
The majority of the Company's receivables arise primarily from credit cards, management agreements, trade customers and other reimbursable amounts due from hotel operators where the Company operates a food and beverage service.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, cash and cash equivalents are defined as cash on hand and highly liquid instruments with original maturities of three months or less when purchased. As of December 31, 2022 and 2021, Benihana's cash and cash equivalents consisted of cash in banks and at the restaurants.
Specifically, on December 31, 2022, Benihana held $55,121 in cash and cash equivalents. In the prior year, on December 31, 2021, the company's cash and cash equivalents totaled $23,614.
This indicates the amount of readily available funds Benihana has to meet its short-term obligations and invest in its business. For a prospective franchisee, understanding the composition and amounts of cash and cash equivalents can provide insight into the financial health and liquidity of the company.