What was the retained earnings balance for Fat Shack as of December 31, 2022?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
| Balance, December 31, 2022 | $ | $85 | $15 | $ 279,900 | $ 723,186 | $ 1,003,186 | |
|---|---|---|---|---|---|---|---|
| Net income | 218,715 | 218,715 | |||||
| Dividends | (165,000) | (165,000) | |||||
| Balance, December 31, 2023 | $ | $85 | $15 | $ 279,900 | $ 776,901 | $ 1,056,901 | |
| Net income | 130,795 | 130,795 | |||||
| Dividends | (180,000) | (180,000) | |||||
| Balance, December 31, 2024 | $ | $85 | $15 | $ 279,900 | $ 727,696 | $ 1,007,696 |
Source: Item 23 — Receipts (FDD pages 53–223)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, the retained earnings balance as of December 31, 2022, was $723,186. This figure is part of the Statement of Stockholders' Equity, which details changes in the company's equity accounts over the financial years. The statement includes common stock, additional paid-in capital, and retained earnings.
Retained earnings represent the accumulated net income of Fat Shack that has not been distributed to stockholders as dividends. It's an important indicator of the company's financial health and its ability to reinvest in the business or distribute profits in the future. For a prospective franchisee, a healthy retained earnings balance suggests financial stability and potentially a greater capacity for Fat Shack to support its franchisees.
The Statement of Stockholders' Equity also shows the net income and dividend payouts for the years 2023 and 2024, providing a historical view of how Fat Shack has managed its earnings. In 2023, net income was $218,715 with dividend payouts of $165,000, and in 2024, net income was $130,795 with dividend payouts of $180,000. These figures offer insight into Fat Shack's profitability and dividend policy, which can be useful for potential investors or franchisees assessing the company's financial performance.
It is important to note that while retained earnings provide a snapshot of past financial performance, they do not guarantee future success. Prospective franchisees should consider this information in conjunction with other financial metrics and business factors when evaluating the franchise opportunity.