What was the total amount of allowance for credit losses for Craters & Freighters in 2023?

According to Craters & Freighters' 2025 Franchise Disclosure Document, the allowance for credit losses was $50,000 in 2023. This allowance is management's best estimate of potential credit losses from accounts receivable. It is a reduction in the carrying amount of accounts receivable.

The allowance for credit losses is based on an analysis of historical loss experience, current receivables aging, and management's assessment of current conditions. Craters & Freighters uses an aging method to estimate these allowances. This means they look at how long invoices have been outstanding to predict the likelihood of non-payment.

For a prospective franchisee, this figure indicates the level of risk Craters & Freighters anticipates in collecting its accounts receivable. A higher allowance suggests a greater expectation of potential losses from unpaid invoices. This is a normal accounting practice to ensure that financial statements accurately reflect the value of assets, in this case, accounts receivable.