What was the amount of the advance from affiliate for Chop5 Salad Kitchen as of December 31, 2023?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
S) | -$ | (48,082) | $ | (52,836) | S | |
| Member Contributions | Accumulated (Deficit) | Total lember Equity | ||||
|---|---|---|---|---|---|---|
| BALANCE, DECEMBER 31, 2020 | $ 10 | 00,000 | $ | - | $ | 100,000 |
| Net income | - | |||||
| BALANCE, DECEMBER 31, 2021 | 10 | 00,000 | 100,000 | |||
| Net (loss) | (52 | 2,836) | (52,836) | |||
| BALANCE, DECEMBER 31, 2022 | 10 | 00,000 | (52 | 2,836) | _ | 47,164 |
| Net (loss) | (48 | 3,082) | (48,082) | |||
| BALANCE, DECEMBER 31, 2023 | $ 10 | 00,000 | $ (100 | ),918) | $ | (918) |
| YEARS | ENDI | ED DECEMB | ER 31, | |||
|---|---|---|---|---|---|---|
| 2023 | 2022 | 2021 | ||||
| CASH FLOWS FROM OPERATING ACTIVITIES Net income | $ | (48,082) | $ | (52,836) | $ | |
| Net cash used by operating activities | = | (48,082) | (52,836) | = | ||
| CASH FLOWS FROM INVESTING ACTIVITIES Net cash (used) in investing activities | • | : | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES Advance from affiliate Net cash provided (used) by financing activities | _ | 50,000 |
Source: Item 23 — RECEIPT (FDD pages 50–178)
What This Means (2024 FDD)
According to Chop5 Salad Kitchen's 2024 Franchise Disclosure Document, the advance from affiliate as of December 31, 2023, was $154,789. The advance from affiliate as of December 31, 2022, was $134,789.
This indicates that Chop5 LLC, the parent company, provided financial support to Chop5 Franchise LLC. For a prospective franchisee, this related-party transaction highlights the financial relationship between the franchise company and its parent entity.
Understanding the nature and terms of such advances is crucial. A franchisee should inquire about the repayment terms, interest rates, and any potential impact these advances might have on the financial stability of Chop5 Salad Kitchen.