How are sales by Company-operated Gold Star restaurants recognized and reported?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
Sales by Company-operated restaurants were recognized when food and beverage items were sold and were reported, net of sales taxes collected from guest that are remitted to the appropriate taxing authorities.
Additionally, the Company has a revenue-sharing agreement for a Tom + Chee restaurant at Kings Island. The Company is responsible for staffing and operating the location while Kings Island provides the location. Gross Sales are split 50/50 between both parties. There are no minimum revenue requirements.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, sales from company-operated restaurants are recognized when food and beverage items are sold to customers. These sales are reported net of sales taxes, meaning the taxes collected from customers are subtracted before the sales figures are reported. The collected sales taxes are then remitted to the appropriate taxing authorities.
This accounting practice ensures that Gold Star's reported revenue accurately reflects the income the company retains from its restaurant sales, excluding the pass-through amounts for sales taxes. This is a standard accounting procedure in the restaurant industry, as sales taxes are collected on behalf of the government and do not represent revenue for the business.
Additionally, Gold Star has a revenue-sharing agreement for a Tom + Chee restaurant at Kings Island. Under this agreement, Gold Star is responsible for staffing and operating the location, while Kings Island provides the location itself. The gross sales generated at this location are split 50/50 between Gold Star and Kings Island, and there are no minimum revenue requirements in place.