What was the total shareholders' equity for Bombs Away?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
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BOMBS AWAY FRANCHISING LLC BALANCE SHEET DECEMBER 31, 2023
| | ASSETS | | |----------------------------|--------------------------------------------|----------| | CURRENT ASSETS | | | | Cash and Cash Equivalents | | $ 5,000 | | Accounts Receivable | | 515 | | | TOTAL CURRENT ASSETS | 5,515 | | NON-CURRENT ASSETS | | | | | TOTAL NON-CURRENT ASSETS | - | | | TOTAL ASSETS LIABILITIES AND OWNER'S EQUITY | 5,515 | | CURRENT LIABILITIES | | | | Deferred Revenue (current) | | 9,000 | | | TOTAL CURRENT LIABILITIES | 9,000 | | NON-CURRENT LIABILITIES | | | | Deferred Revenue | | 6,000 | | Due to Related Party | | 59,397 | | | TOTAL NON-CURRENT LIABILITIES | 65,397 | | | TOTAL LIABILITIES | 74,397 | | OWNER'S EQUITY | | | | Retained Earnings | | (41,721) | | Net Income (Loss) | | (27,161) | | | TOTAL SHAREHOLDERS' EQUITY | (68,882) | | | TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 5,515 |
BOMBS AWAY FRANCHISING LLC STATEMENT OF CASHFLOWS FOR THE YEAR ENDED DECEMBER 31, 2023
| Net Income | $ (27,161) |
|---|---|
| Non-Cash Adjustments | |
| Changes in Current Assets | (515) |
| Changes in Deferred Revenue | 15,000 |
| NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES | (12,676) |
| INVESTING ACTIVITIES | |
| NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES | - |
| FINANCING ACTIVITIES | |
| Owner's Contribution | (91,721) |
| Due to Related Party | 59,397 |
| NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES | (32,324) |
| NET INCREASE (DECREASE) IN CASH | (45,001) |
| CASH AT BEGINNING OF PERIOD | 50,000 |
| CASH AT END OF PERIOD | $ 5,000 |
BOMBS AWAY FRANCHISING LLC STATEMENT OF SHAREHOLDERS' EQUITY DECEMBER 31, 2023
| Balance | Changes | Total | |
|---|---|---|---|
| Balance, December 31, 2022 | $ 50,000 | $ - | $ 50,000 |
| Net Income For The Period Ended December 31, 2023 | - | (27, |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 35)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, the company's total shareholders' equity as of December 31, 2023, was a negative $68,882. This negative equity is calculated from retained earnings of ($41,721) and a net loss of ($27,161). This indicates that the company's liabilities exceeded its assets at the end of 2023.
In contrast, the balance sheet as of December 31, 2022, shows Bombs Away had a total shareholders' equity of $50,000, which was entirely composed of retained earnings. This reveals a significant downturn in the company's financial position over the course of 2023.
A prospective franchisee should carefully consider these figures and investigate the reasons for the substantial decrease in shareholders' equity. Understanding the factors that contributed to the net loss and the shift from positive to negative equity is crucial for assessing the financial stability and future prospects of Bombs Away.