What was the current portion of Chem Dry's deferred revenue in 2022?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
| Liabilities and Stockholders' Equity | ||||
|---|---|---|---|---|
| Current Liabilities | ||||
| Accounts payable | $203 | $855 | $1,046 | |
| Operating lease obligation - Current portion (Note 10) | 1,002 | 1,145 | 1,078 | |
| Deferred revenue - Current portion | 1,305 | 2,050 | 2,532 | |
| Accrued and other current liabilities: | ||||
| Accrued compensation | 1,201 | 1,256 | 1,661 | |
| Other accrued liabilities | 2,251 | 1,678 | 1,807 | |
| Total current liabilities | 5,962 | 6,984 | 8,124 | |
| Operating Lease Obligation - Net of current | ||||
| portion (Note 10) | 2,166 | 425 | 1,549 | |
| Other Long-term Liabilities | ||||
| Deferred revenue - Net of current portion | 3,202 | 4,864 | 6,664 | |
| Deferred tax liabilities (Note 11) | 3,266 | 3,001 | 5,596 | |
| Total liabilities | 14,596 | 15,274 | 21,933 | |
| 70,383 | 115,695 | 122,025 | ||
| Stockholders' Equity | ||||
| Total liabilities and stockholders' equity | $84,979 | $130,969 | $143,958 |
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, the current portion of deferred revenue for Chem Dry in 2022 was $2,050 (thousands omitted). This liability represents revenue that Chem Dry has received but not yet earned, typically related to franchise fees or other services to be provided in the future. The current portion indicates the amount expected to be recognized as revenue within the next year.
For a prospective Chem Dry franchisee, this figure provides insight into the company's financial stability and revenue recognition practices. A higher deferred revenue balance could suggest strong future revenue streams, as it reflects upfront payments for services not yet rendered. However, it's important to consider this figure in relation to Chem Dry's overall financial performance and growth trajectory.
Understanding deferred revenue is crucial for assessing the long-term financial health of Chem Dry. Franchisees should inquire about the specific services or products associated with the deferred revenue and the timeline for recognizing this revenue. This information can help franchisees evaluate the sustainability of Chem Dry's revenue model and its ability to meet future obligations.