What was the increase or decrease in prepaid expense for Crawlspace Medic in 2021?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
,112 | $ | 460,495 | $ 147,585 |
STATEMENTS OF CASH FLOWS CSM FRANCHISE GROUP, LLC
| 2022 | 2021 | 2020 | |
|---|---|---|---|
| CASH FLOWS FROM OPERATING ACTIVITIES | $ 808,447 | $ 954,060 | $ 218,669 |
| Net income | |||
| Changes in operating assets and liabilities: | |||
| (Increase) decrease in franchisee fees receivable | 280,000 | (275,000) | (5,000) |
| (Increase) decrease in royalty fees receivable | 9,972 | 3,918 | (9,590) |
| (Increase) decrease in due from related parties | 9,599 | (9,599) | - |
| (Increase) decrease in prepaid expense | 6,918 | (12,168) | - |
| Increase (decrease) in accounts payable and | |||
| accrued expenses | (11,088) | 22,144 | 630 |
| Decrease in due to related party | (1,444) | (20,676) | - |
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 1,102,404 | 662,679 | 204,709 |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||
| Payment on related party financing | - | (21,460) | (53,629) |
| Members' withdrawals | (1,052,830) | (641,150) | (22,222) |
| NET CASH USED IN FINANCING ACTIVITIES | (1,052,830) | (662,610) | (75,851) |
| NET CHANGE IN CASH AND CASH EQUIVALENTS | 49,574 | 69 | 128,858 |
| Cash and cash equivalents at beginning o |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 42)
What This Means (2024 FDD)
According to Crawlspace Medic's 2024 Franchise Disclosure Document, the prepaid expense decreased by $12,168 in 2021. This figure is part of the cash flow statement, specifically within the changes in operating assets and liabilities section. This decrease in prepaid expenses contributed to the overall net cash provided by operating activities for that year.
Prepaid expenses are payments made in advance for goods or services that will be received in the future. A decrease in this account typically means that Crawlspace Medic used more of the previously paid-for services during 2021 than it prepaid for during the year. This could be due to various factors, such as changes in operational needs or adjustments in payment schedules with vendors.
For a prospective Crawlspace Medic franchisee, understanding these cash flow dynamics is crucial. Changes in prepaid expenses can impact the overall financial health and cash flow of the business. Monitoring these changes can help franchisees better manage their own expenses and predict future cash needs. It's also important to note that this figure reflects the franchisor's corporate operations and may not directly translate to the franchisee's experience, but it provides insight into the franchisor's financial management practices.