When did Deka Lash begin amortizing internally developed software?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
s ending December 31, 2023, 2022, and 2021, was $17,948, $13,439, and $19,608, respectively.
4. INTANGIBLE ASSETS
PROPERTY AND EQUIPMENT
Total property and equipment, net
| (A) 1 20 M (A) (A) (A) (A) (A) (A) (A) (A) (A) (A) | 12 | /31/2023 | 1 | 2/31/2022 | 12 | 31/2021 | |-------------------------------------------------
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
According to the 2024 Deka Lash Franchise Disclosure Document, Deka Lash started amortizing its internally developed software in 2022. This amortization began when the software applications were completed. The company estimated the remaining useful life of the software to be three years and used the straight-line method for amortization.
The amortization expense for internally developed software was reported as $18,000 for the year ending December 31, 2023, $13,556 for the year ending December 31, 2022, and $0 for the year ending December 31, 2021. This indicates that the software was not yet in use or completed in 2021, hence no amortization expense was recorded for that year.
For a prospective Deka Lash franchisee, this information provides insight into the company's accounting practices related to its internally developed software. Understanding how Deka Lash manages and accounts for its software assets can be useful in assessing the company's financial health and investment in technology. The amortization expense also reflects the cost allocation of these assets over their useful life, which can impact the company's profitability and financial statements.