What was the amount of deductions/write-offs for the allowance for credit losses for Brain Balance in 2024?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
| The activity in the allowance for credit losses is as follows: | ||||
|---|---|---|---|---|
| 2024 | 2023 | 2022 | ||
| Balance - January 1 | $ | - $ | 3,938 $ | 3,938 |
| Additions charged to expense | 59,741 | 5,560 | - | |
| Deductions/Write-offs | (29,978) | (9,498) | - | |
| Balance - December 31 | $29,763 $ | - $ | 3,938 |
Source: Item 23 — RECEIPTS (FDD pages 72–292)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, the deductions/write-offs for the allowance for credit losses in 2024 were $29,978. This figure represents the amount of uncollectible accounts receivable that Brain Balance wrote off during the year.
An allowance for credit losses is a contra-asset account used to reduce the total amount of accounts receivable to the amount that is expected to be collected. The activity in the allowance for credit losses is affected by the additions charged to expense and deductions/write-offs.
For a prospective Brain Balance franchisee, this indicates the level of uncollectible debt that the company has experienced. Monitoring these figures over time can reveal trends in the financial health of Brain Balance's franchisees and the effectiveness of its credit policies. A high level of write-offs could indicate financial difficulties among franchisees or a need to reassess credit and collection practices.