What was the net increase in cash for Gokhale Method in 2023?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
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| 2023 | ||
|---|---|---|
| Cash flows from operating activities: | ||
| Net income | $ | 3,735 |
| Adjustments to reconcile net income to net | ||
| cash provided by operating activities: | ||
| Changes in operating assets and liabilities | ||
| Accounts receivable | (11,987) | |
| Accounts payable and other current liabilities | 1,825 | |
| Deferred revenue | 40,870 | |
| Net cash provided by operating activities | 34,443 | |
| Net increase in cash | 34,443 | |
| Cash and cash equivalents - beginning of year | 120,141 | |
| Cash and cash equivalents - end of year | $ | 154,584 |
| Supplemental disclosures of cash flow information: | ||
| Taxes paid | $ | 800 |
| Interest paid | $ | - |
| int |
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to the 2024 Gokhale Method FDD, the net increase in cash for Gokhale Method in 2023 was $34,443. This figure represents the overall change in the company's cash position during the year, taking into account all cash inflows and outflows. This increase is derived from several factors, including a net income of $3,735, adjustments for changes in operating assets and liabilities such as accounts receivable decreasing by $11,987, accounts payable and other current liabilities increasing by $1,825, and deferred revenue increasing by $40,870.
For a prospective Gokhale Method franchisee, understanding the net increase in cash provides insight into the financial health and operational efficiency of the company. A positive net increase suggests that the company is generating more cash than it is using, which can be a sign of stability and growth potential. It also reflects how well Gokhale Method manages its working capital, as indicated by the changes in accounts receivable, accounts payable, and deferred revenue. These elements directly impact the company's ability to fund its operations and invest in future expansion.
It's important to note that while the net increase in cash is a positive indicator, it should be evaluated in conjunction with other financial metrics and qualitative factors. Franchisees should consider the sustainability of these cash flows and whether they are driven by one-time events or ongoing operational improvements. Additionally, understanding the relationship between net income and cash flow, as well as the impact of changes in working capital accounts, can provide a more comprehensive view of Gokhale Method's financial performance. Examining these figures in relation to previous years can also reveal trends and potential areas of concern or opportunity.