What was the change in Cinnaholic's accounts receivable in the year ended December 31, 2023?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
| 71,199 | (331,695) | |||
|---|---|---|---|---|
| Members' (Deficit) - Beginning | (2,290,083) | (2,025,527) | ||
| Members' Contributions (Distributions) | 108,591 | 67,139 | ||
| Members' (Deficit) - Ending | $ (1,710,293) | $ (2,290,083) | # CINNAHOLIC FRANCHISING LLC STATEMENTS OF CASH FLOWS |
| YEARS ENDED | DECEMBER 31 | ||
|---|---|---|---|
| 2024 | 2023 | ||
| Operating Activities | |||
| Net (Loss) | $ 471,199 | $ (331,695) | |
| Adjustments to reconcile net (loss) to net cash | 3 471,133 | 3 (331,033) | |
| provided by operating activities: | |||
| Changes in assets and liabilities | |||
| Due from franchisee | 1,500 | _ | |
| Accounts Receivable | - | 94,821 | |
| Prepaid Expenses | 117,143 | (101,926) | |
| Investments (securities) | - | 88,212 | |
| Contract Assets | 87,346 | 3,657 | |
| Accounts payable and accrued expenses | (110,381) | (12,248) | |
| Related party payable | 143,121 | 61,000 | |
| Advertising fund liability | (10,218) | ||
| Contract Liabilities | (806,931) (97,003) (27)2227 | 67,572 (140,825) (2.0,020) | |
| Financing Activities | |||
| SBA loan payments | (148,312) | ||
| Investing Activities |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 61)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the accounts receivable increased by $94,821 during the year ending December 31, 2023. This figure is part of the statement of cash flows, specifically within the operating activities section. It reflects the change in the amount of money owed to Cinnaholic by its customers or franchisees during that period.
An increase in accounts receivable typically suggests that Cinnaholic has made more sales on credit, or that it is collecting payments from its franchisees more slowly. For a prospective franchisee, this could indicate the financial dynamics between Cinnaholic and its franchisees. It is important to note that while an increase in accounts receivable can reflect growing sales, it can also signal potential issues with collecting payments, which could impact Cinnaholic's cash flow.
It is also important to note that the FDD includes an independent auditor's report stating that the financial statements present fairly the financial position of Cinnaholic Franchising, LLC as of December 31, 2023, and 2022, and the results of its operations and its cash flows for the years then ended, in accordance with accounting principles generally accepted in the United States of America.