What was the depreciation expense for Fat Shack in 2023?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
the straight-line method over an estimated useful life of 5 years.
Property and equipment consist of Restaurant Equipment purchased during June 2021 in the amount of $66,537. Depreciation expenses for the year ended December 31, 2024, 2023 and 2022 was $6,876, $6,876 and $6,876, respectively. Accumulated depreciation as of December 31, 2024, 2023 and 2022 totaled $32,051, $25,175 and $18,299 respectively.
Property and equipment also included a POS system placed into service in August 2017 in the amount of $9,354. Depreciation expense for the year ended December 31, 2024, 2023 and 2022 was $0, $1,248 and $1,871, respectively. Accumulated depreciation as of December
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, the company's depreciation expense for restaurant equipment in 2023 was $6,876. This equipment was originally purchased in June 2021 for $66,537, and Fat Shack uses the straight-line depreciation method over an estimated useful life of 5 years.
In addition to restaurant equipment, Fat Shack also depreciated a POS (Point of Sale) system. The depreciation expense for the POS system in 2023 was $1,248. The POS system was placed into service in August 2017 at a cost of $9,354.
Therefore, the total depreciation expense for Fat Shack in 2023, considering both the restaurant equipment and the POS system, was $8,124 ($6,876 + $1,248). This figure represents the accounting expense recognized for the wear and tear or obsolescence of these assets during that year. Prospective franchisees should understand how Fat Shack depreciates its assets, as this impacts the company's financial statements and overall profitability.