What was the total cost capitalized by Floyds 99 for software development as of December 29, 2024?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
losses would be insignificant to these financial statements. Accordingly, for the years ended December 29, 2024; December 31, 2023; and December 25, 2022, there were no write-offs of trade accounts receivable.
Accounts receivable as of December 27, 2021 was $77,185.
December 29, 2024; December 31, 2023; and December 25, 2022
Note 2 - Significant Accounting Policies (Continued)
Notes Receivable
Notes receivable are reported at original issue amount plus accrued interest, less principal repaid. Interest is recognized according to the terms of the specific notes. An allowance for loan losses is based on a specific assessment of all notes that are delinquent or determined to be doubtful
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 FDD, Floyds 99 incurred costs related to developing a website and a new point-of-sale system. These software costs are being amortized over a three-year period. As of December 29, 2024, the total cost capitalized for this software development was $860,279.
For a prospective franchisee, this indicates that Floyds 99 has invested significantly in technology to support its franchise operations. The fact that these costs are capitalized and amortized suggests that Floyds 99 views these software assets as providing long-term value to the company and its franchisees. The amortization expense for 2024 was $50,629, and the total accumulated amortization as of December 29, 2024, was $764,289.
It's important to note that costs incurred before the final software selection and costs not qualifying for capitalization are expensed, meaning they are recognized immediately rather than spread out over time. This accounting treatment can impact the company's financial statements and should be considered when evaluating the financial health of Floyds 99.