What was the depreciation and amortization expense recognized in the consolidated statements of comprehensive loss for Benjamin Franklin Plumbing for the year ended December 31, 2022?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
| Buildings and leasehold improvements | 5 - 30 years | $ | 5,945 | $ | 5,794 |
|---|---|---|---|---|---|
| Software- for internal use | 1 - 3 years | 13,533 | 8,900 | ||
| Software- to be sold | 3 - 5 years | 36,522 | 36,522 | ||
| Vehicles | 2 - 5 years | 27,358 | 26,404 | ||
| Office equipment and furniture | 2 - 5 years | 4,601 | 4,157 | ||
| Machinery, equipment and tools | 2 - 7 years | 3,103 | 2,965 | ||
| Land | 143 | 143 | |||
| Software in development | 10,007 | 10,290 | |||
| Total property and equipment | 101,212 | 95,175 | |||
| Less: Accumulated depreciation, amortization and impairment | (66,5 |
Source: Item 22 — CONTRACTS (FDD pages 87–88)
What This Means (2025 FDD)
According to Benjamin Franklin Plumbing's 2025 Franchise Disclosure Document, the depreciation and amortization expense recognized in the consolidated statements of comprehensive loss was $12,548 for the year ended December 31, 2022. Of this amount, $6,401 related to software to be sold and was included in franchise support expenses.
For a prospective franchisee, understanding depreciation and amortization is crucial as it reflects the wearing out or consumption of assets over time. This figure indicates the level of investment Benjamin Franklin Plumbing has in its assets and how these assets are being utilized. A higher depreciation and amortization expense could suggest significant investments in infrastructure, technology, or equipment, which may translate to better support and resources for franchisees.
However, it's important to note that depreciation and amortization are non-cash expenses, meaning they don't directly impact the company's cash flow. Instead, they represent the allocation of the cost of assets over their useful lives. Therefore, while a higher expense might reduce the company's reported profit, it doesn't necessarily mean the company is less profitable in terms of cash generation. Franchisees should consider this expense in conjunction with other financial metrics to get a comprehensive understanding of Benjamin Franklin Plumbing's financial performance.
Furthermore, the fact that a portion of the depreciation and amortization expense is related to software to be sold highlights the importance of technology in Benjamin Franklin Plumbing's operations. This suggests that the company is investing in developing and maintaining software that can be used by franchisees, which could provide a competitive advantage in the market. Franchisees should inquire about the specific software being developed and how it can benefit their business.