What was the reported total finance lease cost for Carls in fiscal year 2023?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
| 01,301 |
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We sublease to others some of our property under finance leases. These assets are recorded as lease receivables and are included in accounts receivable, net and other assets, net in our accompanying Consolidated Balance Sheets. As of January 31, 2024, future minimum lease and sublease rent revenue expected to
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, the total finance lease cost for the fiscal year 2023 was reported as $3,907. This figure encompasses several components, including the amortization of finance lease assets, interest on finance lease liabilities, and variable lease costs.
Specifically, the amortization of finance lease assets amounted to $2,432, while the interest on finance lease liabilities was $1,302. The variable lease costs contributed $173 to the total finance lease cost. These individual components, when combined, constitute the total finance lease cost of $3,907 for the fiscal year 2023.
For a prospective Carls franchisee, understanding these costs is crucial as finance leases can represent a significant financial obligation. These costs reflect the expense associated with leasing assets rather than owning them outright, and they can impact the overall profitability and cash flow of the franchise. Franchisees should carefully evaluate the terms of any finance leases and consider their potential impact on their financial performance.