What was the Accumulated Retained Earnings (Deficit) balance for Gokhale Method as of December 31, 2020?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
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| Common Stock | Common Stock | Common Stock | APIC | Stockholder's | Accumulated Retained | Total Stockholders' | |
|---|---|---|---|---|---|---|---|
| Voting Shares | Non-Voting Shares | Amount | Amount | Contribution | Earnings (Deficit) | Equity | |
| Balance at January 1, 2020 | 200 | 1 | S | S 74,995 | $ 25,662 | 74,995 $ 25,662 $ (31,665) $ 68,997 | $ 68,997 |
| Net income | 26,730 | 26,730 | |||||
| Balance at December 31, 2020 | 300 | v | 74,9 |
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to Gokhale Method's 2024 Franchise Disclosure Document, the Accumulated Retained Earnings (Deficit) as of December 31, 2020, was ($4,935). This figure represents the cumulative profits or losses that Gokhale Method has retained in its business since its inception, after accounting for dividends or other distributions to its stockholders. A deficit, indicated by the negative sign, means that the company's accumulated losses exceed its accumulated profits.
For a prospective Gokhale Method franchisee, this information provides insight into the financial health and historical profitability of the company. While a deficit doesn't necessarily indicate current financial instability, it's a point to consider when evaluating the franchise opportunity. It is important to note that this figure pertains to Gokhale Method Institute, Inc., a wholly-owned subsidiary of Gokhale Method Enterprises, Inc.
It is advisable for potential franchisees to further investigate the reasons behind the accumulated deficit and understand how Gokhale Method plans to address it. This could involve reviewing the company's financial statements in more detail, asking specific questions during the due diligence process, and seeking advice from a financial advisor. Understanding the context of this deficit is crucial for making an informed decision about investing in a Gokhale Method franchise.