What was the long-term portion of the total deferred revenue for Hck Hot Chicken in 2023?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
rred revenue
The following table presents changes in the Company's deferred revenues for the years ended December 31, 2024 and 2023:
| 2024 | 2023 | |||||
|---|---|---|---|---|---|---|
| Deferred franchise fees: | - | - | ||||
| Balance at January 1 | $ | 148,333 | $ | 78,667 | ||
| Payments due on contracts | 40,000 | 80,000 | ||||
| Revenue recognized during the period | ( | 18,666 | . ) | ( | 10,333 | ) |
| Balance at December 31 | $ | 169,667 2024 | $ | 148,334 2023 | ||
| Deferred area rep fees: | Y. | 1 | ||||
| Balance at January 1 | $ | 531,240 | $ | 168,000 | ||
| Payments due on contracts | - | 444,900 | ||||
| Revenue recognized during the period | ( | 154,660 | . ) | ( | 81,660 | ) |
| Balance at December 31 | $ | 376,580 | $ | 531,240 | ||
| Total deferred revenue | $ _ | 546,247 2024 | $ | 679,574 2023 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
According to Hck Hot Chicken's 2025 Franchise Disclosure Document, the long-term portion of the total deferred revenue for 2023 was $589,914. The total deferred revenue for 2023 was $679,574, with $89,660 classified as current.
Deferred revenue represents payments Hck Hot Chicken has received for goods or services that have not yet been delivered or earned. In the case of a franchise, this often includes the initial franchise fee, which is recognized as revenue over the term of the franchise agreement. The "current" portion represents the amount expected to be recognized within the next year, while the "long-term" portion is the amount expected to be recognized in periods beyond one year.
For a prospective Hck Hot Chicken franchisee, this information provides insight into the company's financial health and how it manages its revenue recognition. A significant amount of deferred revenue can indicate strong future revenue streams, as it represents obligations to provide services or products that have already been paid for. Monitoring these figures can help a franchisee assess the stability and growth potential of the Hck Hot Chicken franchise system.