What was the total net value of Hardees' property and equipment in 2023 after accounting for accumulated depreciation and amortization?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
Property and equipment are recorded at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method based on the assets' estimated useful lives, which generally range from three to 40 years.
Leasehold improvements are amortized on a straight-line basis over the shorter of the estimated useful lives of the assets or the related lease terms. The amortization period for leasehold improvements includes renewal option periods only in instances in which the exercise of the renewal option is reasonably certain at the acquisition date because failure to exercise such option would result in an economic penalty.
We capitalize direct costs and interest costs associated with construction projects that have a future benefit. If we subsequently make a determination that a site for which development costs have been capitalized will not be acquired or developed, any previously capitalized development costs are expensed and included in general and administrative expenses.
Source: Item 21 — Financial Statements (FDD pages 84–85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the methodology for handling property and equipment is outlined. Hardees records its property and equipment at cost, and then reduces this value by accumulated depreciation and amortization. Depreciation is calculated using the straight-line method, based on the estimated useful lives of the assets, which typically range from three to 40 years. Leasehold improvements are amortized on a straight-line basis over the shorter of the asset's estimated useful life or the lease term. This amortization period includes renewal option periods only when the renewal is reasonably certain at the acquisition date, and failure to renew would result in an economic penalty.
Hardees also capitalizes direct and interest costs associated with construction projects that are expected to provide a future benefit. However, if the company determines that a site will not be acquired or developed, any previously capitalized development costs are expensed and included in general and administrative expenses. This accounting treatment is standard and ensures that the book value of Hardees' assets reflects their actual economic value over time.
However, the 2025 FDD does not specify the exact total net value of Hardees' property and equipment after accumulated depreciation and amortization for the year 2023. A prospective franchisee should ask the franchisor for this specific figure to gain a clearer understanding of the company's asset values and financial position.