When does Crave Cookies recognize revenue from product or equipment sales?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company also sells products and services to customers. Sales to customers typically include products or equipment. The Company's performance obligation under these sales is to deliver products or equipment to customers and revenue is recognized at that point. The timing and amount of revenue recognized related to these revenues was not impacted by the adoption of Topic 606.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, revenue from product and equipment sales is recognized when the goods are delivered to the customer. Crave Cookies considers its performance obligation fulfilled once the products or equipment are in the customer's possession.
This means that Crave Cookies recognizes the revenue at the point of sale or delivery, rather than over a period of time. This is a common practice for tangible goods, as the transfer of control is clear and immediate.
For a prospective franchisee, this indicates that any purchases of products or equipment from Crave Cookies will be recognized as revenue by Crave Cookies at the time of delivery. This revenue recognition method provides a straightforward accounting approach for these types of sales.