What was the total amount of Crisp & Green's contract liabilities on December 31, 2021?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
s but did change how the allowance for credit losses is determined.
NOTE 2 ACCOUNTS RECEIVABLE
Accounts receivable consists of the following at December 31:
| Franchisees | $ 504,399 | $ 2,148,675 | $ | 744,194 |
|---|---|---|---|---|
| Parent | 15,430 | 15,782 | - | |
| Total | $ 519,829 | $ 2,164,457 | $ | 744,194 |
Accounts receivable balance as of December 31
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, the company's total contract liabilities, specifically deferred franchise fees, amounted to $4,496,300 as of December 31, 2021. This figure represents the cumulative amount of franchise fees that Crisp & Green had collected but not yet recognized as revenue as of that date.
Deferred franchise fees typically arise when Crisp & Green receives initial franchise fees upfront but has not yet fulfilled all of its obligations to the franchisee, such as providing training, site selection assistance, or pre-opening support. These fees are recognized as revenue over the period that the services are provided, which is why they are classified as a liability on the balance sheet until earned.
For a prospective Crisp & Green franchisee, this information provides insight into the financial health and revenue recognition practices of the franchisor. A significant deferred revenue balance suggests that Crisp & Green is actively selling franchises and has a pipeline of future revenue. Monitoring the trend of deferred franchise fees over time can also indicate the growth and stability of the franchise system.