How are refunds handled in the 'Program Sales' calculation for a Body Brain Center franchise?

According to the 2025 Body Brain Center Franchise Disclosure Document, refunds are specifically addressed in the calculation of 'Program Sales.' Program Sales are defined as all gross sums received from services sold at the business, including memberships and referral fees, but excluding revenues from product sales and sales and use taxes.

Importantly, the definition of 'Program Sales' explicitly accounts for refunds. Any amounts included in Program Sales for one reporting period that are subsequently refunded to customers will be deducted from the franchisee's Program Sales in the next reporting period. This means that if a Body Brain Center franchisee initially reports revenue from a program sale but later issues a refund, the franchisee does not get to keep the royalty on the refunded amount. Instead, the refund is accounted for by reducing the Program Sales, and thus the royalty owed, in the subsequent reporting period.

This approach ensures that Body Brain Center franchisees are not paying royalties on revenue they did not ultimately retain due to refunds. Franchisees are required to provide reports of both Program Sales and product sales and must record all sales information on the same day the sale occurs, which is essential for accurate royalty calculations and refund tracking.