What is the range of years for the leasehold and land improvements depreciation for Checkers?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| (Successor) | Estimated Useful Lives | ||||||
|---|---|---|---|---|---|---|---|
| December 30, 2024 | January 1, 2024 | ||||||
| Leasehold and land improvements | 2,270 | 804 | 1-10 years |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the estimated useful life for leasehold and land improvements is between 1 and 10 years. This means that Checkers depreciates these assets over this period for accounting purposes.
For a prospective Checkers franchisee, this depreciation timeframe affects the financial statements of the franchise. Depreciation is a non-cash expense that reduces the reported profit of the business, which can lower income tax obligations. The shorter the depreciation period, the larger the annual depreciation expense, and the lower the reported profit in the early years of the asset's life.
It is important to note that while the FDD specifies a general range, the actual depreciation period for a specific leasehold or land improvement may vary based on its estimated useful life or the remaining lease term, as described in Item 21. Franchisees should consult with a financial professional to understand the specific depreciation implications for their business.