What was the cash and cash equivalents at the beginning of the period for Face Foundrie in 2023?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
| (559,155) | | Member distributions | (507,842) | | Net income | 233,689 | | Balance at December 31, 2023 | (833,308) | | Member distributions | (486,625) | | Net income | 937,141 | | Balance at December 31, 2024 | $ (382,792) |
STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2024, 2023 and 2022
| 2024 | 2023 | 2022 | ||||
|---|---|---|---|---|---|---|
| Cash flows from operating activities: | ||||||
| Net income (loss) | $ | 937,141 | $ | 233,689 | $ | (409,453) |
| Adjustments to reconcile net income (loss) | ||||||
| to net cash provided by activities: | ||||||
| Depreciation and amortization | 14,016 | 10,015 | 889 | |||
| Change in operating assets and liabilities: | ||||||
| Accounts receivable, net | (328,459) | 4,709 | 153,863 | |||
| Prepaid expenses | 9,446 | (17,976) | - | |||
| Note receivable related party | - | (619,014) | (9,232) | |||
| Deferred contract costs | 30,000 | 4,000 | 4,000 | |||
| Other current assets | 29,383 | 44,068 | (73,451) | |||
| Accounts payable | 22,548 | 20,074 | - | |||
| Accrued expenses | 8,209 | (31,805) | 46,662 | |||
| Credit card payable | (2,707) | 12,578 | (10,880) | |||
| Gift card liability | 966,166 | 755,694 | 712,734 | |||
| Operating lease liability | 3,032 | 4,165 | 5,276 | |||
| Deferred revenue | 313,904 | 464,900 | 785,720 | |||
| Net cash provided by operating activities | 2,002,679 | 885,097 | 1,206,128 | |||
| Cash flows from investing activities: | ||||||
| Purchase of equipment | (4,557) | - | (7,466) | |||
| Purchases of intangible assets | - | (20,000) | (42,340) | |||
| Net cash used in investing activities | (4,557) | (20,000) | (49,806) | |||
| Cash flows from financing activities: | ||||||
| Contributions | - | - | 55,552 | |||
| Distributions | (486,625) | (507,842) | (120,995) | |||
| Net cash used in financing activities | (486,625) | (507,842) | (65,443) | |||
| Net change in cash and cash equivalents | 1,511,497 | 357,255 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 73)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, the cash and cash equivalents at the beginning of the period in 2023 was $1,611,868. The company's accounting period is the 12-month period ending December 31 of each year. Cash equivalents include all highly liquid investments with maturities of three months or less at the date of purchase.
This figure represents the amount of readily available funds Face Foundrie had at its disposal to cover immediate obligations and operational expenses at the start of 2023. It is important to note that this number reflects the financial position of Face Foundrie Franchising LLC, and not necessarily the financial standing of individual franchise locations.
A prospective franchisee should consider this information in the context of Face Foundrie's overall financial health and stability. While a healthy cash balance is generally a positive sign, it is essential to review other financial metrics and trends to gain a comprehensive understanding of the company's financial performance. Reviewing the balance sheets, statements of operation, and cash flows for 2022, 2023, and 2024 can provide a more complete picture of Face Foundrie's financial history and trajectory.
Additionally, the FDD states that as of December 31, 2022, $700,015 was set aside by the company for satisfaction of the gift card liability. This means that a portion of the cash and cash equivalents is specifically reserved to cover outstanding gift card obligations, which could impact the company's flexibility in using those funds for other purposes.