What is the accounting period used by Extreme Art Studio Franchising, LLC?

According to the 2024 Extreme Art Studio Franchise Disclosure Document, the company's accounting period is the 12-month period ending on December 31 of each year. This means that Extreme Art Studio tracks its financial performance and position over a calendar year, from January 1 to December 31.

For a prospective franchisee, understanding the franchisor's accounting period is important for several reasons. It allows the franchisee to align their own financial reporting with that of Extreme Art Studio, making it easier to compare performance and identify trends. Additionally, it provides a framework for understanding the financial statements presented in the FDD, which are prepared based on this accounting period.

Knowing the accounting period also helps franchisees plan their own business operations and financial management. For example, they can use the franchisor's accounting period as a benchmark for setting their own sales targets and expense budgets. Furthermore, it allows them to better understand the timing of royalty payments and other financial obligations to Extreme Art Studio.

In the franchise industry, using a 12-month accounting period ending on December 31 is a common practice, as it aligns with the standard calendar year used by most businesses. This consistency makes it easier for franchisees, franchisors, and financial professionals to analyze and compare financial data across different franchise systems.