What was the contract liability for Decorating Den Interiors in 2024?
Decorating_Den_Interiors Franchise · 2025 FDDAnswer from 2025 FDD Document
income tax asset | 441,200 | 258,500 | 136,800 | | Total other assets | 1,768,301 | 1,817,253 | 1,351,535 | | Total assets | $ 6,748,671 | $ 7,765,993 | $ 7,630,712 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | 2024 | 2023 | 2022 |
|---|---|---|---|
| CURRENT LIABILITIES Accounts payable Accrued expenses Accrued payroll expenses Contract liability Merchandising Incentive Fund liabilities Operating lease liability Total current liabilities | $ 172,422 | $ 197,175 | $ 206,470 |
| 34,227 | 64,736 | 60,546 | |
| 98,368 | 80,284 | 65,311 | |
| 530,376 | 524,782 | 497,607 | |
| 1,260,481 | 1,400,190 | 1,418,407 | |
| 160,810 | 144,422 | 10,664 | |
| 2,256,684 | 2,411,589 | 2,259,005 | |
| LONG-TERM LIABILITIES Contract liability, net of current portion Operating lease liability, net of current portion |
Source: Item 21 — Financial Statements (FDD page 59)
What This Means (2025 FDD)
According to Decorating Den Interiors' 2025 Franchise Disclosure Document, the company's total contract liability is divided into current and long-term liabilities. The current contract liability for Decorating Den Interiors in 2024 was $530,376. The long-term contract liability, net of the current portion, was $2,472,660.
It is important to understand the nature of these liabilities. Contract liabilities typically represent deferred revenue or obligations to provide future services or goods for which payment has already been received. For a Decorating Den Interiors franchisee, this could relate to customer deposits for design projects not yet completed or other advanced payments.
The sum of both current and long-term contract liabilities for Decorating Den Interiors in 2024 was $3,003,036. A prospective franchisee should review the complete financial statements and notes to fully understand Decorating Den Interiors' financial obligations and how these liabilities might impact the company's financial stability and ability to support its franchisees.
Understanding the trend of these liabilities over the three years presented (2022-2024) can also provide insights. While the current liability has slightly increased from $497,607 in 2022 to $530,376 in 2024, the long-term liability has fluctuated. A potential franchisee should inquire about the reasons for these changes and how Decorating Den Interiors manages its contract liabilities.