What was the retained earnings (accumulated deficit) for Gokhale Method in 2020?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
22
| 2021 | 2020 | |||
|---|---|---|---|---|
| ASSETS | ||||
| CURRENT ASSETS | ||||
| Cash and cash equivalents | S | 120,520 | 5 | 112,072 |
| Accounts receivable, net | 4,941 | 3,344 | ||
| Other current assets | - | - | 428 | |
| TOTAL ASSETS | S | 125,461 | S | 115,844 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
| CURRENT LIABILITIES | ||||
| Accounts payable | 5 | 8,652 | $ | 6,731 |
| Deferred revenue | 4,825 | 13,248 | ||
| Payable to Teachers | 1,365 | |||
| Other current liabilities | - | 138 | _ | 138 |
| TOTAL LIABILITIES | _ | 14,980 | 1 | 20,117 |
| STOCKHOLDERS' EQUITY | ||||
| Common stock (1,000 voting shares anthorized, 500 shares issued and | 5 | 5 | ||
| outstanding, $0.01 par value) | ||||
| Common stock (1,000 non-voting shares authorized, no shares issued | ||||
| and outstanding, $0.01 par value) | ||||
| Additional Paid in Capital | 74,995 | 74,995 | ||
| Stockholder's contribution | 25,662 | 25,662 | ||
| Retained earnings (accumulated deficit) | _ | 9,819 | (4,935) | |
| Total stockholders' equity | 110,481 | 95,727 | ||
| TOTAL LIABILITIES & STOCKHOLDERS' EQUI |
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to Gokhale Method's 2024 Franchise Disclosure Document, the company had retained earnings (accumulated deficit) of ($4,935) in 2020. This figure is part of the broader financial statements that include assets, liabilities, and equity. The document provides a comparative view, showing figures for both 2020 and 2021, allowing for a year-over-year analysis.
Specifically, the retained earnings figure is a component of the total stockholders' equity, which also includes common stock, additional paid-in capital, and stockholder's contribution. In 2020, the total stockholders' equity amounted to $95,727. This indicates that the accumulated deficit of ($4,935) was offset by other positive equity components.
For a prospective franchisee, this information is crucial as it provides insight into the financial health and historical performance of Gokhale Method. A negative retained earnings balance suggests that the company had more accumulated losses than profits up to that point. However, it's important to consider this figure in conjunction with other financial metrics and trends to gain a comprehensive understanding of the company's financial stability and growth potential.