What was the beginning balance of the franchise contract liability for Deck Medic as of December 31, 2022?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
----|---------|---------|--|--| | $ | 2,250 | $ | 2,250 | | | | 122 | 163,940 | | 173,856 | | | | $ | 166,190 $ | $ 163,940 | 176,106 163,940 | | |
Contract Balances
The following table provides information about the change in the franchise contract liability balances during the years ended December 31, 2023 and 2022 respectively. Franchise contract liability is included in deferred revenue on the accompanying balance sheets.
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, the following table provides information about the change in the franchise contract liability balances during the years ended December 31, 2022 and 2021, respectively. Franchise contract liability is included in deferred revenue on the accompanying balance sheets.
| December 31, 2022 | December 31, 2021 | |
|---|---|---|
| Beginning balance | $224,843 | $159,778 |
As of December 31, 2022, the beginning balance for franchise contract liability was $224,843. This represents the amount of deferred revenue Deck Medic had at the start of the year related to franchise contracts. This deferred revenue typically arises from initial franchise fees that Deck Medic has collected but not yet recognized as earned revenue, as they still have obligations to fulfill to the franchisees.
For a prospective Deck Medic franchisee, this information provides insight into the company's financial handling of franchise fees. A significant beginning balance suggests that Deck Medic collects a substantial amount in initial fees and recognizes the revenue over time as they provide ongoing support and services to their franchisees. This liability represents a future obligation for Deck Medic to provide services to its franchisees. The beginning balance for franchise contract liability as of December 31, 2021 was $159,778.