What was the allowance for credit losses related to Chem Dry's notes receivable in 2023?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
to income before taxes is as follows:
| 2022 | |||||
|---|---|---|---|---|---|
| 2023 | (As Restated) | 2021 | |||
| Income tax |
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, the company had an allowance for credit losses related to notes receivable. However, the provided excerpts do not specify the exact amount of the allowance for credit losses related specifically to notes receivable in 2023.
The FDD excerpts do provide information on the allowance for credit losses related to deferred tax assets. The allowance for credit losses related to deferred tax assets was $531,000 in 2023, $941,000 in 2022 and $1,312,000 in 2021.
To get a clearer picture of the credit risks associated with Chem Dry's notes receivable, a prospective franchisee should ask the franchisor for the specific allowance for credit losses related to notes receivable, how the allowance is calculated, and what factors might cause these losses to increase in the future. Understanding these details will help in assessing the financial stability of Chem Dry and the potential risk associated with franchisee financing.