What was the total value of Benihana's accounts receivable as of December 31, 2022?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
sumptions.
- We evaluated the reasonableness of management's undiscounted future cash flows analysis by comparing management's projections to (1) the Company's historical results, (2) internal communications to management and the Board of Directors, (3) external communications made publicly by management, and (4) industry data.
- We tested the completeness and accuracy of the underlying source information used by management to identify quantitative indicators o
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, the total value of accounts receivable as of December 31, 2022, was $15,220. This figure is part of the company's consolidated balance sheets, which provide a snapshot of Benihana's assets, liabilities, and equity at a specific point in time. Accounts receivable represents the money owed to Benihana by its customers for goods or services already provided but not yet paid for.
For a prospective Benihana franchisee, understanding the accounts receivable is crucial for assessing the financial health and operational efficiency of the company. A higher accounts receivable balance might indicate that Benihana is extending more credit to its customers, which could boost sales but also increase the risk of bad debts. Conversely, a lower balance could suggest stricter credit policies or faster payment collection.
It's also important to note that the majority of Benihana's receivables arise primarily from credit cards, management agreements, trade customers, and reimbursable amounts due from hotel operators where Benihana operates a food and beverage service. Accounts receivable from credit card processors and third-party delivery services at December 31, 2022 was $6.4 million. Receivables from the Company's management, license and hotel partners were $7.0 million at December 31, 2022. The company has not reserved any trade receivables as of December 31, 2022. Franchisees should inquire about Benihana's credit policies, collection procedures, and the aging of its accounts receivable to gain a better understanding of the company's working capital management and potential risks associated with uncollectible accounts.