What is the net value of Closet Storage Concepts' property and equipment?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
Property and equipment are stated at cost. Depreciation of property and equipment for financial reporting purposes is provided using the straight‐line method over their respective estimated useful lives ranging from 5 to 15 years. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. When property and equipment is sold or otherwise disposed of, the asset account and any accumulated depreciation accounts are relieved, and any gain or loss is included in other income and expense on the income statement.
The carrying amount of all long‐lived assets is evaluated periodically to determine if an adjustment to the depreciation period, or the non‐depreciated balance is warranted. Based on its most recent analysis, the Company believes that no impairment of property and equipment exists.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts' 2025 Franchise Disclosure Document, the document states that property and equipment are recorded at cost. The document explains that Closet Storage Concepts uses the straight-line depreciation method over an estimated useful life ranging from 5 to 15 years. The company capitalizes expenditures that extend the useful life of the assets and expenses costs incurred for maintenance and repairs. When property is disposed of, the asset and accumulated depreciation are relieved with any gain or loss included on the income statement.
The document states that Closet Storage Concepts evaluates the carrying amount of long-lived assets to determine if adjustments are needed. Based on the most recent analysis, the company believes that no impairment of property and equipment exists.
However, the specific net value of Closet Storage Concepts' property and equipment is not disclosed in this section. A prospective franchisee should inquire about the specific value of property and equipment to understand the company's asset base and financial health.