What was the amount of accounts receivable applied to notes payable for Exit franchisees in the year ending December 31, 2022?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
| Cash paid during the year for: | |||
|---|---|---|---|
| Cash paid during the year for interest | $ 49,502 | $ 74,777 | $ 90,746 |
| Deferred rent reclassified as operating lease | |||
| --- | --- | --- | --- |
| right-of-use assets | $ - | $ - | $ 69,213 |
| Leasehold improvement allowances reclassified as | |||
| --- | --- | --- | --- |
| operating lease right-of-use asset | $ - | $ - | $ 189,111 |
| Operating lease liability arising from recognition of | |||
| --- | --- | --- | --- |
| right-of-use asset | $ - | $ - | $ 428,236 |
| Unrealized holding gains (losses) on investments included | |||
| --- | --- | --- | --- |
| in accumulated other comprehensive income (loss) | $ 5,568 | $ 7,017 | $ (9,239) |
| Accounts receivable applied to notes payable | $ - | $ - | $ 10,100 |
| Acquisition of franchise territory right renewals financed | |||
| --- | --- | --- | --- |
| with notes payable | $ - | $ 287,044 | $ - |
| Reduction of franchise fees arising from restructuring | |||
| of related notes payable | $ - | $ 1,275,185 | $ - |
| Proceeds from sales of available-for-sale securities | |||
| --- | --- | --- | --- |
| reinvested | $ 1,307 | $ 1,380 | $ - |
| Reclassification adjustment for net losses included in | |||
| net losses | $ - | $ 425 | $ - |
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, accounts receivable applied to notes payable for the year ending December 31, 2022, was $10,100.
This indicates that Exit allowed franchisees to use their outstanding accounts receivable to offset or reduce their notes payable obligations during that year. This could be a mechanism to provide financial flexibility to franchisees.
For a prospective franchisee, this information is relevant in understanding how Exit manages franchisee finances and offers potential relief during challenging times. It's important to inquire about the specific conditions and eligibility criteria for applying accounts receivable to notes payable, as this may not be a standard practice every year or for all franchisees.
Understanding these types of financial arrangements can help a franchisee better manage their cash flow and financial obligations within the Exit franchise system.