What was the amount of franchise royalties for Golden Corral as of January 3, 2024?
Golden_Corral Franchise · 2025 FDDAnswer from 2025 FDD Document
equity | $ | 34,442,904 | $ | 41,797,402 | | |
Golden Corral Franchising Systems, Inc. Statements of Income and Retained Earnings Years Ended January 1, 2025, January 3, 2024 and December 28, 2022
| January 1, 2025 | January 3, 2024 | December 28, 2022 | |
|---|---|---|---|
| Revenues | |||
| Franchise fees | 1,114,671 | 861,498 | 927,688 |
| $ | $ | $ | |
| Franchise royalties | 67,580,016 | 68,369,670 | 61,165,079 |
| Franchise advertising | 39,011,024 | 39,521,429 | 34,395,514 |
| Total revenues | 107,705,711 | 108,752,597 | 96,488,281 |
| Expenses | |||
| Administration | 23,798,133 | 20,127,730 | 19,421,248 |
| Legal fees | 1,150 | 1,150 | |
| Franchise advertising | 41,590,745 | 38,145,024 | 33,251,896 |
| Total operating expenses | 65,390,028 | 58,273,904 | 52,673,144 |
| Income before income taxes | 42,315,683 | 50,478,693 | 43,815,137 |
| Income tax expense | 220,000 | 232,000 | 225,000 |
| Net income | 42,095,683 | 50,246,693 | 43,590,137 |
| R |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 84)
What This Means (2025 FDD)
According to Golden Corral's 2025 Franchise Disclosure Document, the franchise royalties for the year ended January 3, 2024, totaled $68,369,670. This figure represents the income Golden Corral Franchising Systems, Inc. received from its franchisees based on a percentage of their sales.
Franchise royalties are a crucial revenue stream for Golden Corral, reflecting the ongoing success and sales volume of its franchise locations. For prospective franchisees, this indicates the scale of the royalty payments they will be obligated to make based on their restaurant's revenue. Understanding this figure is essential for assessing the financial viability of a Golden Corral franchise.
It's important to note that royalty fees accrue based on a percentage of franchisee sales when collectability of the fee is reasonably assured, and costs relating to royalty fees are expensed as incurred. This accounting practice ensures that Golden Corral recognizes royalty revenue in a manner that aligns with its financial performance and the performance of its franchisees.