What was the note receivable forgiveness for Deka Lash in 2/31/2023?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
Notes receivables at December 31, 2023 consists of the following:
Note receivable with an entity. The interest rate on this note is 6% with payments of $1,846 expected to start in December 2027 with the full balance expected to be received by November 2032. Payment terms include forgiveness of portions of principle balances based on the opening and operating of studios. 37,050 (37,050)Less: Allowance for balance likely to exercise forgiveness terms of contract 30,914
(13,414)
Less amounts expected in one year
17.500
As of December 31, 2023, accrued interest of $2,408 is recognized for these notes receivable with an allowance of $(2,408) for balance likely to exercise forgiveness terms of the contract.
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
The 2024 Deka Lash Franchise Disclosure Document does not contain the specific figure for note receivable forgiveness as of February 31, 2023, as the date provided is not a valid date. However, the FDD does provide information on notes receivable as of December 31, 2023.
Specifically, Deka Lash had notes receivable with an entity where the interest rate is 6%, with payments of $1,846 expected to start in December 2027 and the full balance expected to be received by November 2032. The payment terms include forgiveness of portions of principle balances based on the opening and operating of studios. The original note was for $37,050, but there was an allowance of ($37,050) for the balance likely to exercise forgiveness terms of the contract.
Additionally, as of December 31, 2023, accrued interest of $2,408 is recognized for these notes receivable with an allowance of $(2,408) for balance likely to exercise forgiveness terms of the contract. A prospective franchisee should ask Deka Lash for clarification on the specific amount of note receivable forgiveness that occurred during 2023 to fully understand the financial implications of these notes.