What was the total tax provision for Big Apple Bagels in 2024?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
| - | - | | | Other | 34,253 | 36,628 | 47,099 | | | Marketing fund expense | 1,176,663 | 1,243,890 | 1,081,320 | | | Total Operating Costs and Expenses | 2,729,907 | 2,677,089 | 2,419,376 | | Income from Operations | 601,703 | 610,468 | 597,846 | | | Interest Income | 2,074 | 456 | 412 | | | Income before Income Taxes | 603,777 | 610,924 | 598,258 | | | Provision/(Benefit) for Income Taxes | | | | | | | Current | 165,857 | 158,549 | 92,341 | | | Deferred | 4,150 | 19,448 | 75,966 | | | Total Tax Provision | 170,007 | 177,997 | 168,307 | | Net Income | 433,770 | 432,927 | 429,951 | | | Retained Earnings, Beginning of Year | 8,859,801 | 8,426,874 | 7,996,923 | | | Retained Earnings, End of Year (Exhibit A) | | $ 9,293,571 | $ 8,859,801 | $ 8,426,874 |
| Years Ended November 30, 2024, 2023 and 2022 | ||||
|---|---|---|---|---|
| 2024 | 2023 | 2022 | ||
| Operating Activities | ||||
| Net Income | $ 433,770 | $ 432,927 | $ 429,951 | |
| Adjustments to reconcile net income to cash | ||||
| flows provided by operating activities: | ||||
| Depreciation | - | - | 748 | |
| Provision for doubtful accounts (recoveries) | 22,230 | 18,000 | (3, |
Source: Item 23 — RECEIPTS (FDD pages 87–319)
What This Means (2025 FDD)
According to Big Apple Bagels' 2025 Franchise Disclosure Document, the deferred income tax (benefit)/expense for 2024 was $4,150. This figure represents an adjustment made to reconcile net income to cash flows provided by operating activities. It indicates the net change in the company's deferred tax assets and liabilities during the fiscal year.
A deferred tax asset arises when a company has overpaid taxes or has tax deductions or credits that can be used to reduce future taxable income. Conversely, a deferred tax liability arises when a company has taxable income that is not yet recognized for tax purposes, such as accelerated depreciation. The $4,150 figure suggests that Big Apple Bagels had a slight increase in deferred tax expense for 2024.
For a prospective franchisee, understanding these figures is crucial for assessing the financial health and tax strategies of Big Apple Bagels. While this specific line item reflects adjustments at the corporate level, it provides insight into how the company manages its tax obligations, which can indirectly affect franchisees through the overall stability and profitability of the franchise system. Reviewing these figures over several years, as presented in the table, can offer a more comprehensive understanding of the company's tax position and its potential impact on the franchise.