What was the net cash provided by (used in) operating activities for Deck Medic in 2022?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
| | C. Operations Manual Table of Contents | H. State Specific Addenda | | D. Financial Statements | I. State Effective Dates | | E. Franchise Agreement | J. Receipts |
| 2023 | 2022 | |
|---|---|---|
| Cash Flows From Operating Activities: | ||
| Net income (loss) | $ (4,533) | $ (28,455) |
| Adjustments to reconcile net income to net cash | ||
| provided by operating activities: | ||
| Provision for bad debt | 13,680 | 12,765 |
| Change in assets and liabilities: | ||
| Accounts receiv |
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, the net cash used in operating activities in 2022 was $(14,895). This figure represents the net cash flow resulting from the company's core business activities, taking into account revenues, expenses, and changes in working capital accounts. A negative value indicates that Deck Medic's operating activities consumed more cash than they generated during that year.
Several factors contributed to this net cash usage. The company experienced a net loss of $(28,455). However, this loss was partially offset by adjustments to reconcile net income to net cash, such as a provision for bad debt of $12,765. Changes in assets and liabilities also played a role, including an increase in accounts receivable of $447, an increase in accounts payable and accrued liabilities of $2,598 and a decrease in deferred revenue of $(2,250).
For a prospective Deck Medic franchisee, this information is crucial for understanding the financial dynamics of the company. While a single year's negative cash flow doesn't necessarily indicate long-term problems, it warrants further investigation. A potential franchisee should inquire about the reasons for the cash usage, whether it was due to specific investments or operational challenges, and how Deck Medic plans to improve its cash flow from operations in the future. Understanding these factors will help the franchisee assess the financial stability and growth potential of the franchise system.