What was the change in accounts receivable for Floors To Go in 2024?
Floors_To_Go Franchise · 2025 FDDAnswer from 2025 FDD Document
redit losses | | 52,720 | | 35,724 | | Travel, meals and entertainment | | 33,996 | | 49,481 | | General office | | 623 | | 6,328 | | Total operating expenses | | 1,637,084 | | 1,617,390 | | Net income | | 1,517,901 | | 1,709,639 | | Member's equity, beginning of year | | 549,866 | | 1,259,440 | | Member distributions | | (1,367,895) | | (2,419,213) | | Member's equity, end of year | $ 699,872 $ 549,866 | | | |
Statements of Cash Flows
| Year Ended December 31 | ||||
|---|---|---|---|---|
| 2024 | 2023 | |||
| Cash flows from operating activities | ||||
| Net income | $ | 1,517,901 | $ | 1,709,639 |
| Adjustments to reconcile net income to net cash | ||||
| from operating activities | ||||
| Credit losses | 52,720 | 35,724 | ||
| Changes in operating assets and liabilities | ||||
| which (used) provided cash | ||||
| Accounts receivable | (62,626) | (113,736) | ||
| Prepaid expenses | 714 | - | ||
| Accounts payable | (8,963) | (5,267) | ||
| Deferred reve |
Source: Item 23 — RECEIPTS (FDD pages 47–204)
What This Means (2025 FDD)
According to Floors To Go's 2025 Franchise Disclosure Document, the change in accounts receivable for the period ending December 31, 2024, was a decrease of $62,626. This figure reflects the net change in the amount of money owed to Floors To Go by its customers (franchisees and others) for goods or services provided on credit. This decrease in accounts receivable suggests that Floors To Go collected more money from its receivables than it extended in new credit during the year.
For a prospective Floors To Go franchisee, this information provides insight into the company's cash flow management and its ability to collect outstanding payments. A decrease in accounts receivable could indicate more efficient collection processes or stricter credit terms. However, it is important to consider this figure in conjunction with other financial data to gain a comprehensive understanding of the company's financial health.
It's also worth noting that the FDD includes information on credit losses. The expense associated with the allowance for credit losses was $52,720 for the year ended December 31, 2024. This allowance reflects management's estimate of the amount of accounts receivable that may not be collectible. This is a common accounting practice to account for potential bad debt.
Overall, the change in accounts receivable and the allowance for credit losses provide valuable information for potential franchisees to assess the financial stability and risk associated with investing in a Floors To Go franchise. Reviewing these figures over multiple years, if available, would provide a more complete picture of the company's financial performance and trends.