What was the accumulated amortization for Exit's organization costs as of December 31, 2023?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Costs incident to the organization of the Company, including legal fees, were capitalized. These expenses are being amortized on a straight-line basis over a period of fifteen years and are stated at cost net of accumulated amortization.
Based on the review of intangible assets completed for the years ended December 31, 2024, 2023, and 2022, no impairment was recorded. Amortization expense totaled $84,066, $235,330, and $321,280 for the years ended December 31, 2024, 2023, and 2022, respectively.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the costs associated with organizing the company, including legal fees, are capitalized and amortized on a straight-line basis over fifteen years. These costs are reported net of accumulated amortization. The FDD does not explicitly state the accumulated amortization for Exit's organization costs as of December 31, 2023.
However, the FDD does provide the total amortization expense for intangible assets. For the year ended December 31, 2023, the amortization expense totaled $235,330. This figure includes amortization for various intangible assets, not solely the organization costs. It is important to note that on September 10, 2023, Exit entered into a 10-year agreement with Exit Realty Corp. International for the franchise territories managed by the company, which led to a revaluation of intangible assets.
To determine the specific accumulated amortization for organization costs, a prospective franchisee should request a detailed breakdown from Exit. This information is crucial for understanding the company's financial structure and the value of its intangible assets. Understanding the amortization schedule will allow a franchisee to better forecast the future profitability of Exit.