What was the allowance for doubtful accounts related to deferred tax assets for Carbones Pizzeria?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
| Allowance for doubtful accounts | $ 54,000 |
|---|---|
| Change in accruals | 9,000 |
| Total deferred tax assets | 63,000 |
| Deferred tax liability: | |
| Property and equipment | (19,000) |
| Total deferred tax liability | (19,000) |
| Net deferred tax asset | $ 44,000 |
| Allowance for doubtful accounts | $ 34,000 |
|---|---|
| Change in accruals | 5,000 |
| Total deferred tax assets | 39,000 |
| Deferred tax liability: | |
| Property and equipment | (26,000) |
| Total deferred tax liability | (26,000) |
| Net deferred tax asset | $ 13,000 |
| Cash and cash equivalents | $ 161,252 |
|---|---|
| Accounts receivable, net of allowance for doubtful accounts of $109,133 | 287,928 |
| Due from stockholder | 492,605 |
| Accounts receivable, related party | 107,489 |
| Inventory | 3,650 |
| Prepaid expenses | 19,005 |
| Total current assets | 1,071,929 |
| Note receivable | 60,500 |
| Deferred tax assets | 13,000 |
| Property and equipment, net | 164,212 |
| Total assets | $ 1,309,641 |
Source: Item 22 — CONTRACTS (FDD page 30)
What This Means (2025 FDD)
According to the 2025 FDD, Carbones Pizzeria provides information on allowance for doubtful accounts in relation to deferred tax assets. For the period ending February 28, 2025, the FDD states that the deferred tax assets totaled $13,000. The allowance for doubtful accounts was $109,133, which was netted against the accounts receivable.
For the year ended October 31, 2023, the allowance for doubtful accounts was $54,000, contributing to a total deferred tax asset of $63,000. In the previous year, ending October 31, 2022, the allowance for doubtful accounts was $34,000, resulting in a total deferred tax asset of $39,000.
These figures reflect Carbones Pizzeria's assessment of potential uncollectible accounts and their impact on the company's deferred tax assets. A prospective franchisee should understand how these allowances are calculated and how they might affect the financial performance of their own franchise location. Reviewing these figures over multiple years can provide insight into the consistency and reliability of Carbones Pizzeria's financial reporting practices.