What was the total revenue recognized over time for Bens Soft Pretzels?
Bens_Soft_Pretzels Franchise · 2025 FDDAnswer from 2025 FDD Document
2024, 2023, and 2022
NOTE 2 – REVENUE RECOGNITION (CONTINUED)
Disaggregation of revenue from contracts with customers (continued)
| Franchise | Royalty | Advertising | Other | _ | |
|---|---|---|---|---|---|
| Fees | Fees | Fund Fees | Income | Total | |
| Revenue from contracts with customers | $ 147,358 | $ 1,064,701 | $ 232,493 | $ 18,418 | $ 1,462,970 |
| Revenue from other sources | - | - | - | 49,588 | 49,588 |
| $ 147,358 | $ 1,064,701 | $ 232,493 | $ 68,006 | $ 1,512,558 | |
| Franchise | Royalty | Advertising | Other | ||
| Fees | Fees | Fund Fees | Income | Total | |
| Revenue recognized at a point in time | $ - | $ 1,064,701 | $ 232,493 | $ 18,418 | $ 1,315,612 |
| Revenue recognized over time | 147,358 | 147,358 | |||
| Revenue from contracts with customers | $ 147,358 | $ 1,064,701 | $ 232,493 2022 2022 | $ 18,418 | $ 1,462,970 |
| Franchise | Royalty | Advertising | Other | ||
| Franchise Fees | Royalty Fees | Other Income | Total | ||
| Revenue from contracts with customers | Advertising | Total $ 1,203,880 | |||
| Revenue from contracts with customers Revenue from other sources | Fees | Fees | Advertising Fund Fees | Income | |
| Fees | Fees | Advertising Fund Fees | Income $ 7,480 | $ 1,203,880 | |
| Fees $ 128,065 | Fees $ 877,461 | Advertising Fund Fees $ 190,874 | Income $ 7,480 45,126 | $ 1,203,880 45,126 | |
| Fees $ 128,065 - $ 128,065 | Fees $ 877,461 - $ 877,461 | Advertising Fund Fees $ 190,874 - $ 190,874 | $ 7,480 45,126 $ 52,606 | $ 1,203,880 45,126 | |
| Fees $ 128,065 - $ 128,065 Franchise | Fees $ 877,461 $ 877,461 Royalty | Advertising Fund Fees $ 190,874 - $ 190,874 Advertising | Income 7,480 45,126 52,606 Other | $ 1,203,880 45,126 $ 1,249,006 | |
| Revenue from other sources | Fees $ 128,065 | Fees $ 877,461 - $ 877,461 Royalty Fees | Advertisin |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 46)
What This Means (2025 FDD)
According to Bens Soft Pretzels' 2025 Franchise Disclosure Document, the revenue recognized over time for the year 2024 was $147,358. This revenue is specifically attributed to franchise fees.
Bens Soft Pretzels recognizes initial franchise fee revenue on a straight-line basis over the initial term of the franchise agreement, starting when the location opens. This approach aligns with accounting standards (ASC 606) that require revenue to be recognized as the company satisfies its performance obligations. In this case, the performance obligation is providing the right to use Bens Soft Pretzels' intellectual property over the franchise term.
For a prospective franchisee, this means that the initial franchise fee paid to Bens Soft Pretzels is not immediately recognized as revenue by the franchisor. Instead, it is recognized gradually over the term of the franchise agreement. This accounting practice provides a more accurate reflection of when Bens Soft Pretzels is actually earning the revenue by fulfilling its obligations to support the franchisee's business over time.