What was the value of C12 Group's right-of-use operating lease assets in 2023?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
1, 2022 | 1,843,880 | | Net income | 1,125,446 | | Distributions | (280,216) | | Balance at December 31, 2023 | $ 2,689,110 | THE C12 GROUP, LLC Statements of Cash Flows Years Ended December 31, 2023 and 2022
| 2023 | 2022 | |
|---|---|---|
| Operating Activities | 8 | |
| Net income | $ 1,125,446 | $ 640,867 |
| Adjustments to reconcile net income to net | ||
| cash provided by operating activities: | ||
| Depreciation | 10,877 | 79,368 |
| Amortization | 104,441 | 22,103 |
| Gain from sale of subsidiary | (276,066) | ~ |
| Changes in operating assets and liabilities: | ||
| Accounts receivable | (56,496) | (84,865) |
| Supplies inventory | (40,497) | (63,920) |
| Prepaid expenses | (386) | 12,669 |
| Operating lease right-of-use asset | 139,987 | 124,177 |
| Accounts payable | (32,396) | 51,858 |
| Accrued expenses | (40,024) | (1,643) |
| Operating lease righ-of-use liability | (129,948) | (131,509) |
| Other assets | (3,669) | |
| Unearned revenue | (675,786) | 815,784 |
| Net cash provided by operating activities | 125,483 | 1,464,889 |
| Investing Activities | ||
| Purchases of property and equipment | (168,879) | (102,668) |
| Repayments on related party note receivable | 231,605 | |
| Net cash provided (used) by investing activities | 62,726 | (102,668) |
| Financing Activities | ||
| Distributions | (280,216) | (109,518) |
| Net cash (used) by financing activities | (280,216) | (109,518) |
| Change in cash and cash equivalents | (92,007) | 1,252,703 |
| Cash and cash equivalents at beginning of year | 1,933,369 | 680,666 |
| Ca |
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, the operating lease right-of-use asset in 2023 was valued at $139,987. This figure represents the change in the value of the operating lease right-of-use asset during the 2023 fiscal year, as part of the adjustments to reconcile net income to net cash provided by operating activities.
Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the term of the lease. C12 Group utilizes the risk-free discount rate, according to their elected policy. This accounting treatment reflects the company's rights to use an asset for a specified period and its obligation to make lease payments.
For a prospective franchisee, understanding these lease obligations is crucial as it impacts the company's financial statements and cash flow. The FDD also indicates that the company had cash balances in excess of the insured limit totaling approximately $139,000 at December 31, 2023. Reviewing these figures helps potential franchisees assess the financial health and stability of C12 Group.