What was the total amount of Chesters' long-term debt in 2022?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
| ASSETS | ||
|---|---|---|
| 2023 | 2022 | |
| CURRENT ASSETS | ||
| Cash | $ 2,515,674 | $ 2,392,340 |
| Accounts receivable, net of allowance for | ||
| doubtful accounts | 5,299,346 | 3,735,366 |
| Due from related parties | 1,117,539 | 684,044 |
| Inventories, net | 1,247,308 | 1,130,712 |
| Prepaid expenses | 49,815 | 101,200 |
| Total current assets | 10,229,682 | 8,043,662 |
| PROPERTY AND EQUIPMENT, NET | 878,650 | 148,788 |
| OPERATING LEASE RIGHT-OF-USE ASSETS, NET | 1,820,812 | 1,304,672 |
| GOODWILL, NET | 1,613,657 | 1,936,388 |
| INTANGIBLE ASSETS, NET | 30,523 | 52,666 |
| TOTAL ASSETS | $ 14,573,324 | $ 11,486,176 |
| LIABILITIES AND MEMBERS' EQUITY | ||
| CURRENT LIABILITIES | ||
| Current maturities of long-term debt | $ 1,628,607 | $ 1,809,133 |
| Accounts payable | 2,904,502 | 719,790 |
| Accrued liabilities | 1,285,555 | 1,365,243 |
| Customer deposits | 609,822 | 533,879 |
| Current portion of operating lease liability | 181,240 | 398,805 |
| Unearned franchise fees | 136,500 | 224,900 |
| Total current liabilities | 6,746,226 | 5,051,750 |
| LONG-TERM LIABILITIES | ||
| Operating lease liabilities, less cu |
Source: Item 21 — **FINANCIAL STATEMENTS (FDD page 48)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the company's total long-term debt in 2022 was $1,429,725. This figure is part of the liabilities reported on Chesters' balance sheet for that year. The balance sheet provides a snapshot of the company's assets, liabilities, and equity at a specific point in time, offering insights into its financial structure and health.
Long-term debt represents obligations that Chesters has due beyond one year. For a prospective franchisee, understanding the franchisor's debt level is crucial because it can indicate the financial stability and the ability of the company to support its franchisees. A high level of debt might suggest that the company is highly leveraged, which could pose risks if the company's financial performance weakens.
It is important to note that the FDD also lists current maturities of long-term debt, which were $1,809,133 in 2022. This represents the portion of the long-term debt due within one year. Reviewing both the current and long-term debt provides a more complete picture of Chesters's overall debt obligations. A potential franchisee should consider these liabilities in conjunction with the company's assets and equity to assess its financial strength and stability before investing in a franchise.