What is the estimated amortization expense for Cicis' website for the fiscal year 2028?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
| 23 | ||
|---|---|---|
| Website | $ 220,000 | $ 220,000 |
| Accumulated amortization | (69,667) | (25,667) |
| Website, net | $ 150,333 | $ 194,333 |
During the years ended December 31, 2024 and 2023, amortization expense associated with the website totaled $44,000 and $25,667, respectively, and is presented with marketing general and administrative costs on the combin
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 58–64)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, the estimated amortization expense for the website for the fiscal year 2028 is $18,333. This expense is based on the current carrying value of the website. Amortization is the process of spreading out the cost of an intangible asset over its useful life. In this case, Cicis is amortizing the cost of its website over a period of time.
For a prospective franchisee, understanding the amortization expense is important for assessing the overall financial health and stability of Cicis. It provides insight into how the company manages its assets and allocates costs. The website amortization expense is presented with marketing general and administrative costs on the combined statements of income.
It's also worth noting that Cicis periodically evaluates the carrying value of its long-lived assets, including the website, for potential impairment. If the anticipated cash flow from the asset is less than its carrying value, Cicis would recognize a loss. This assessment can affect the amortization expense in future years if the value of the website is adjusted.