What do the receivables primarily consist of for Cd One Price Cleaners?
Cd_One_Price_Cleaners Franchise · 2025 FDDAnswer from 2025 FDD Document
Receivables – Receivables consist primarily of amounts due from franchisees for royalty payments and amounts dues from affiliated entities with the same controlling ownership as the Company. The Company does not charge interest or late fees on amounts past due. The Company estimates the allowance based on an analysis of specific franchisees, adjusted for current conditions and reasonable forecasts, taking into consideration the age of past due accounts and an assessment of the franchisee's ability to pay. The Company has not established an allowance for doubtful accounts at December 27, 2024 and December 29, 2023. Accounts deemed uncollectible are charged to expense. There were no amounts due over 90 days at December 27, 2024 or December 29, 2023.
Source: Item 22 — Contracts (FDD page 72)
What This Means (2025 FDD)
According to Cd One Price Cleaners' 2025 Franchise Disclosure Document, the company's receivables primarily consist of amounts due from franchisees for royalty payments and amounts due from affiliated entities with the same controlling ownership as the company. Cd One Price Cleaners does not charge interest or late fees on past due amounts.
The company estimates the allowance for doubtful accounts based on an analysis of specific franchisees, adjusted for current conditions and reasonable forecasts. This analysis considers the age of past due accounts and an assessment of the franchisee's ability to pay. As of December 27, 2024, and December 29, 2023, Cd One Price Cleaners had not established an allowance for doubtful accounts. Accounts deemed uncollectible are charged to expense.
It is also noted that there were no amounts due over 90 days at December 27, 2024, or December 29, 2023. This indicates that Cd One Price Cleaners maintains relatively current collections of its receivables. For the year 2023, the company allowed franchisees the option to defer payment of weekly royalty fees beginning with the week ended July 31, 2020. Prior to 2023, the company estimated the allowance based on its historical experience of the relationship between actual bad debts and net credit sales.