What was the total net lease cost for Checkersrallys for the year ended January 1, 2024?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
ort and services expenses," "general and administrative expenses" and "restaurant retirement costs" within the accompanying consolidated statement of operations.
(Tabular Dollars in Thousands, Except Share and per Share Data)
The following table provides quantitative information concerning the Company's leases under ASC 842, Leases.
| For the | Periods | For the Year Ended | ||||
|---|---|---|---|---|---|---|
| th Jar | June 17, 2023 through January 1, 2024 (Successor) January 3, 2023 through June 16, 2023 (Predecessor) | January 2, 2023 (Predecessor) | ||||
| Finance lease |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the total net lease cost for the period from June 17, 2023, through January 1, 2024 (Successor) was $9,631,000. For the period January 3, 2023, through June 16, 2023 (Predecessor) the total net lease cost was $9,366,000. For the year ended January 2, 2023 (Predecessor) the total net lease cost was $18,322,000.
This figure includes several components such as finance lease costs, amortization of right-of-use assets, interest expense on lease liabilities, operating lease costs, variable lease costs, and a deduction for sublease income. These costs reflect the expenses Checkersrallys incurs for the use of properties and equipment under lease agreements.
For a prospective franchisee, understanding these lease costs is crucial as they represent a significant portion of the overhead expenses. The net lease cost can impact the profitability of individual franchise locations. Franchisees should consider these costs when evaluating the financial viability of a Checkersrallys franchise and compare them against potential revenues and other expenses.
It's also important to note that these figures are based on Checkersrallys's specific accounting practices and lease agreements. Individual franchisees may experience different lease costs depending on their location, lease terms, and other factors. Therefore, prospective franchisees should carefully review their specific lease agreements and consult with financial advisors to fully understand their potential lease obligations.