What is the reported total for Gold Star's operating lease liabilities after adjustments?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
75,716 | | Fair Value of Interest Rate Swap | | 194,930 | 113,503 | - | . - | _ | 308,433 | | Other Assets | | | | | | | | | Right of Use Asset - Operating Leases | | 9,246,018 | _ | 1,846,237 | _ | | 11,092,255 | | Goodwill, Net | | 381,667 | _ | 67,719 | - | | 449,386 | | Trademark | | - | _ | 475,000 | _ | | 475,000 | | Intangibles Subject to Amortization | | 48.595 | _ | - | _ | | 48,595 | | Deposits | | 154,174 | 5,763 | 11,706 | _ | | 171,643 | | Investment in Subsidiary | | (2,164,835) | -, | , | 2,164,835 | | - | | Notes Receivable | | 1,817,565 | - | - | (1,817,565) | _ | | | Total Other Assets | | 9,483,184 | 5,763 | 2,400,662 | 347,270 | _ | 12,236,879 | Total Assets $ __22,596,891 $ __13,748,932 $ __3,368,112 $ __(5,162,356) $ __34,551,579
GOLD STAR CHILI, INC. CONSOLIDATING BALANCE SHEET December 31, 2024 (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
| GSC | |||||
|---|---|---|---|---|---|
| Gold Star | Properties, | ||||
| Chili, Inc. | LLC | TCWW, LLC | Eliminations | Total | |
| Current Liabilities | |||||
| Line of Credit | , | $ - : | $ - | , | |
| Installment Note Payable | 486,680 | 279,987 | - | - | 766,667 |
| Advances - Related Party | 1,940,597 | - | - | (1,940,597) | - |
| Accounts Payable Operating | 534,335 | 43,480 | 47,874 | (53,490) | 572,199 |
| Operating Lease Liabilities | 824,874 | - | 103,424 | - | 928,298 |
| Gift Card Liability | - | - | 70,167 | - | 70,167 |
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the company's total operating lease liabilities, after eliminations and adjustments, amount to $10,530,569 for the long-term portion and $928,298 for the current portion. This means that Gold Star has a significant financial obligation related to its leased properties and equipment. These liabilities reflect the present value of future lease payments for the use of assets such as restaurant locations and equipment.
For a prospective franchisee, understanding these lease obligations is crucial because it provides insight into the financial health and stability of Gold Star. High operating lease liabilities could indicate that the company relies heavily on leased assets, which might impact its profitability and cash flow. It is important to note that these liabilities are part of the overall financial structure and should be considered alongside other assets and liabilities to get a complete picture of the company's financial position.
Furthermore, the distinction between current and long-term liabilities is important. The current portion ($928,298) represents the amount due within the next year, while the long-term portion ($10,530,569) is due beyond one year. This breakdown helps in assessing the company's short-term and long-term financial obligations. A potential franchisee should evaluate how these lease obligations might affect Gold Star's ability to support its franchisees and invest in future growth.
In summary, the operating lease liabilities are a significant component of Gold Star's overall liabilities. Franchisees should carefully review these figures in the context of the company's complete financial statements to assess the financial risks and opportunities associated with investing in a Gold Star franchise. Consulting with a financial advisor to interpret these figures and understand their implications is advisable.