What was the value of Craters & Freighters' Right-of-Use Asset - Operating Lease as of December 31, 2023?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
i LLP
Denver, Colorado April 10, 2024
Balance Sheets
| As of December 31, | 2023 | 2022 |
|---|---|---|
| Current Assets: | ||
| Cash and Cash Equivalents | $ 6,991,649 $ | 2,376,316 |
| Marketable Securities - At Fair Market Value | 634,869 | 528,625 |
| Accounts Receivable - Net of Allowance for | ||
| Credit Losses of $50,000 and $40,000, Respectively | 569,660 | 717,990 |
| Prepaid Expenses | 201,226 | 34,611 |
| Total Current Assets | 8,397,404 | 3,657,542 |
| Property and Equipment - At Cost: | ||
| Office Equipment | 80,614 | 80,613 |
| Furniture and Fixtures | 19,862 | 19,863 |
| Leasehold Improvements | 11,415 | 11,415 |
| Vehicles | 202,688 | 215,039 |
| 314,579 | 326,930 | |
| Less: Accumulated Depreciation | (133,628) | (225,263) |
| Property and Equipment - Net | 180,951 | 101,667 |
| Other Assets: | ||
| Software Development - Net of Accumulated | ||
| Amortization of $317,185 and $215,196, Respectively | 153,931 | 142,272 |
| Due from Related Party | 356,391 | 193,314 |
| Note Receivable | 160,000 | 60,000 |
| Right-of-Use Asset - Operating Lease | 130,071 | 203,307 |
| Deposits | 12,546 | 12,546 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, the value of the Right-of-Use Asset - Operating Lease as of December 31, 2023, was $130,071. This figure represents the company's capitalized cost associated with its operating lease for office space.
The Right-of-Use (ROU) asset reflects Craters & Freighters's right to use an asset (in this case, office space) for the lease term. It is an important component of the company's balance sheet, providing insight into its lease obligations and asset utilization. The corresponding lease liability represents the present value of the remaining lease payments.
Prospective franchisees should understand how Craters & Freighters accounts for its leases, as this can impact the company's financial health and stability. Reviewing the notes to the financial statements, particularly those related to leases, provides additional context on the terms, conditions, and accounting policies applied to these leases. Understanding these details can help a potential franchisee assess the financial obligations Craters & Freighters has undertaken.