What was the deferred tax asset amount related to lease expense for Crepe De Licious?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
Temporary differences that give rise to the net deferred income tax asset/liability consist primarily of credit loss expense, depreciation and lease expense, all of which are recognized differently for financial reporting and income tax purposes.
Amounts for deferred tax assets and liabilities are as follows:
| Deferred income tax asset | $ 7,800 | $ 9,300 | |
|---|---|---|---|
| Deferred income tax liability | (500) | (7,300) | |
| Total net deferred income tax asset | $ 7,300 | $ 2,000 |
Source: Item 23 — RECEIPTS (FDD pages 57–233)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious FDD, temporary differences in income tax calculations arise from how credit loss expense, depreciation, and lease expense are treated for financial reporting versus income tax purposes. The FDD does not explicitly state the deferred tax asset amount related to lease expenses.
However, the document does provide a table that shows the amounts for deferred tax assets and liabilities. It lists the deferred income tax asset as $7,800 for 2024 and $9,300 for 2023. The total net deferred income tax asset is listed as $7,300 for 2024 and $2,000 for 2023.
While the FDD mentions that lease expenses contribute to these deferred tax assets/liabilities, it does not break down the specific amount attributable to leases. A prospective Crepe De Licious franchisee should seek clarification from the franchisor regarding the specific deferred tax asset amount related to lease expenses to fully understand the financial implications.