What was the total adjustment amount for Engineering For Kids in 2023?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
,219 | 37,219 | | BALANCE, December 31, 2024 | $ 100 | $ 112,512 | $ 112,612 |
ENGINEERING FOR KIDS INTERNATIONAL, LLC STATEMENTS CASH FLOWS YEARS ENDED DECEMBER 31, 2024 2023, AND 2022
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| INCREASE (DECREASE) IN CASH AND CASH | |||
| EQUIVALENTS | |||
| Cash flows from operating activities | $ 37,219 | $ 34,933 | $ 56,260 |
| Net income | |||
| Adjustments to reconcile net income to | |||
| net cash provided (used) by operating activities | |||
| Amortization | 10,437 | - | 2,235 |
| Changes in assets and liabilities | |||
| Accounts receivable | (13,138) | 16,709 | (44,865) |
| Prepaid expenses | 3,625 | 111 | 8,879 |
| Accounts payable | (320) | (6,318) | - |
| Due to/from related party | (130,008) | 63,874 | 30,249 |
| Accrued liabilities | (1,927) | 6,244 | (20,060) |
| Total adjustments | (131,331) | 80,620 | (23,562) |
| Net cash provided (used) by operating activities | (94,112) | 115,553 | 32,698 |
| Cash flows from investing activities | |||
| Investment in intangible assets | (1,808) | (28,934) | (22,345) |
| NET INCREASE (DECREASE) IN CASH AND | (95,920) | 86,619 |
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
According to Engineering For Kids' 2025 Franchise Disclosure Document, the total adjustments to reconcile net income to net cash provided by operating activities in 2023 was $80,620. These adjustments are part of the statement of cash flows, which provides insights into how Engineering For Kids generated and used cash during that year.
Specifically, these adjustments include non-cash items and changes in working capital accounts. For 2023, these adjustments include changes in accounts receivable ($16,709), prepaid expenses ($111), accounts payable ($6,318), due to/from related party ($63,874), and accrued liabilities ($6,244). Amortization was $0 in 2023.
For a prospective Engineering For Kids franchisee, understanding these adjustments is crucial for assessing the financial health and cash flow dynamics of the franchisor. A positive total adjustment, as seen in 2023, indicates that the company's operating activities generated more cash than its net income alone would suggest. This could be due to factors like efficient working capital management or significant non-cash expenses like depreciation. Reviewing these figures helps potential franchisees evaluate the franchisor's financial stability and its ability to support its franchisees.