What was the noncash operating lease cost for City Wide in 2024?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
--|---|---| | Balance January 1, 2022 | $ 2,100 | $ 210,000 | $ 366,366 | $ 15,459,388 | $ (5,506) | $ 1 6,032,348 | | Net income | - | - | - | 10,941,550 | - | 1 0,941,550 | | Other comprehensive income | - | - | - | - | 26,999 | 26,999 | | Distributions | - | - | - | ( 8,431,640) | - | (8,431,640) | | Balance December 31, 2022 | 2,100 | 210,000 | 366,366 | 17,969,298 | 21,493 | 1 8,569,257 | | Net income | - | - | - | 14,196,288 | - | 1 4,196,288 | | Other comprehensive loss | - | - | - | - | (6,653) | (6,653) | | Distributions | | | | | | | | | - | - | - | ( 21,712,635) | - | (21,712,635) | | Balance December 31, 2023 | | | | | | | | 2,100 | 210,000 | 366,366 | 10,452,951 | 14,840 | 1 1,046,257 | | | Net income | | | | | | | | | - | - | - | 19,161,078 | - | 1 9,161,078 | | Other comprehensive income | | | | | | | | | - | - | - | - | 39,507 | 39,507 | | Distributions | | | | | | | | | - | - | - | ( 16,582,517) | - | (16,582,517) | | Balance December 31, 2024 | $ 2,100 | $ 210,000 2024 | $ 366,366 2023 | $ 13,031,512 2022 | $ 54,347 | $ 1 3,664,325 | | Operating Activities | | | | | | | | Net income | | $ 19,161,078 | | $ 14,196,288 | | $ 10,941,550 | | Items not requiring (providing) cash | | | | | | | | Depreciation | 999,912 | 1,063,068 | 1,095,919 | | | | | Bad debt expense | 160,526 | 54,103 | 13,153 | | | | | Noncash operating lease cost | 94,315 | 91,359 | 88,451 | | | | | Loss on abandonment of software subscription | 1,454,554 | | - | | - | | | Effect of foreign currency translation (gain) loss | 39,507 | (6,653) | 26,999 | | | | | Deferred compensation | 455,292
Source: Item 23 — RECEIPT (FDD pages 65–271)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, the noncash operating lease cost for the company in 2024 was $94,315. This figure represents expenses related to operating leases that did not involve an actual cash outlay during that year. These costs are a component of the overall financial performance of City Wide and are factored into the company's net income.
For a prospective franchisee, understanding the noncash operating lease cost can provide insight into the financial obligations and expenses that City Wide incurs. While franchisees do not directly pay these costs, they reflect the financial health and operational decisions of the franchisor, which can indirectly impact the support and resources available to franchisees. This information, along with other financial statement details, helps potential franchisees assess the financial stability and management practices of City Wide.
It's important to note that noncash expenses like these are common in business and can arise from various accounting treatments related to leases and other operational agreements. Reviewing these figures in the context of City Wide's overall financial statements, including revenues, other expenses, and cash flows, provides a more complete picture of the company's financial standing. Prospective franchisees should consult with a financial advisor to fully understand the implications of these costs and how they might affect the franchise system's long-term viability.