What was the software expense for Best Brains for the year ending December 31, 2023?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
IES AND STOCKHOLDERS' EQUITY | 4,336,162 | | Current Liabilities | | | | Account and credit card payable | 4,116,083 | 3,545,720 | | Mortgages, notes, bonds payable within 1 year | 157,834 | 50,129 | | Deferred franchise revenue - Current | 111,920 | 45,025 | | Other current liabilities | 157,392 | 170,701 | | Total Liabilities | 4,543,229 | 3,811,576 | | Non-Current Liabilities | | | | Mortgages, notes, bonds payable in 1 year or more | 300,090 | 94,311 | | Economic injury disaster loan (EIDL) | 150,000 | 150,000 | | Deferred franchise revenue - Non-current | 402,161 | 91,143 | | Total Non-current Liabilities | 852,251 | 335,454 | | Stockholders' Equity | | | | Common stock | 1,000 | 1,000 | | Additional paid in capital | 121,375 | 121,375 | | Retained earnings | 77,883 | 66,758 | | Total Stockholders' Equity | 200,258 | 189,133 | | Total Liabilities And Stockholders' Equity | $ 5,595,738 | $ 4,336,162 | | | | |
STATEMENT OF OPERATIONS Years Ended December 31, 2024, and 2023
| December 31, 2024 | December 31, 2023 | |
|---|---|---|
| Revenue | ||
| Franchise fees | $ 77,987 | $ 75,983 |
| Royalty Income | 4,075,600 | 3,502,324 |
| Tuition fees | 1,101,650 | - |
| Material charges | 2,824,687 | 1,974,379 |
| Other operating income | 653,611 | 582,654 |
| Gross Income | 8,733,534 | 6,135,341 |
| Expenses | ||
| Software expense | 1,107,354 | 893,316 |
| Payroll expense | 1,364,838 | 1,124,746 |
| Tuition Fee Reimbursement | 1,103,757 | - |
| Material development charges | 895,686 | 892,640 |
| Contractor's payment | 842,453 | 317,037 |
| Bad debt | 464,041 | - |
| Advertising and marketing | 441,906 | 311,486 |
| Supplies | 381,648 | 283,847 |
| Rent | 275,834 | 286,147 |
| Legal and professional fees | 271,716 | 222,915 |
| Office expense | 248,265 | 205,009 |
| Travel | 157,219 | 203,700 |
| Outside services | 147,209 | 768,500 |
| Insurance | 140,216 | 120,390 |
| Interest expense | 137,921 | 14,001 |
| Payroll tax |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 42)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, the software expense for the year ending December 31, 2023, was $893,316. This figure is part of the expenses listed in the financial statements.
Software expenses can include costs related to various software applications necessary for running the Best Brains business. This may cover educational software, administrative tools, or any other software essential for business operations. Franchisees should understand what specific software this expense covers and whether they will be responsible for any part of these costs directly.
Understanding the components of the software expenses is crucial for prospective franchisees. It is important to determine if these costs are likely to change and how they might impact the overall profitability of a Best Brains franchise. Franchisees should also inquire about any required software upgrades or additional software that may be needed in the future, as these could lead to increased expenses.