What was the change in deferred revenue for Chocolate Bash in 2023?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
D DECEMBER 31, 2023 & DECEMBER 31, 2022 & DECEMBER 31, 2021
| 2023 | 2022 | 2021 | |
|---|---|---|---|
| OPERATING ACTIVITIES | |||
| Net Income | $ 15,483 | $ 28,687 | $ 38,808 |
| Non-Cash Adjustments | |||
| Changes in Deferred Revenue | 24,896 | (23,021) | 22,000 |
| Changes in Due From Affiliate | (35,956) | - | 1,250 |
| Changes in Accounts Receivable | 19,041 | (21,194) | - |
| NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES | 23,464 | (15,528) | 62,058 |
| INVESTING ACTIVITIES | |||
| NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES | - | - | - |
| FINANCING ACTIVITIES | |||
| Owner's Contribution (net) | (61,122) | (30,100) | 17,940 |
| NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES | (61,122) | (30,100) | 17,940 |
| NET INCREASE (DECREASE) IN CASH | (37,658) | (45,628) | 79,998 |
| CASH AT BEGINNING OF PERIOD | 59,295 | 104,922 | 24,924 |
| CASH AT |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 38)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, the change in deferred revenue for 2023 was $24,896. This figure is part of the Statement of Cash Flows, which provides insights into how Chocolate Bash generated and used cash during the fiscal year. Deferred revenue represents payments Chocolate Bash has received for goods or services that have not yet been provided or earned.
A positive change in deferred revenue, such as the $24,896 increase in 2023, typically indicates that Chocolate Bash has collected more cash from franchisees or other sources for future services or products than it has recognized as earned revenue during that period. This could be due to increased franchise sales, initial franchise fees, or other advance payments.
For a prospective Chocolate Bash franchisee, this information is useful for understanding the company's financial health and revenue recognition practices. A consistent increase in deferred revenue might suggest strong sales and future revenue potential. However, it's important to also consider how Chocolate Bash manages its obligations to deliver the services or products associated with this deferred revenue, as failure to do so could impact future financial performance.