What was the total deferred revenue for Hck Hot Chicken in 2024?
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 total deferred revenue for 2024 was $546,247. This total is composed of deferred franchise fees and deferred area representative fees. The deferred franchise fees balance at January 1, 2024 was $148,333, with payments due on contracts of $40,000 and revenue recognized during the period of $18,666, resulting in a balance at December 31, 2024 of $169,667.
The deferred area rep fees balance at January 1, 2024 was $531,240, with revenue recognized during the period of $154,660, resulting in a balance at December 31, 2024 of $376,580. The total deferred revenue is further broken down into current deferred revenue of $123,660 and long-term deferred revenue of $422,587, which combined equals the total deferred revenue of $546,247.
Deferred revenue typically represents payments received by Hck Hot Chicken for services or goods that have not yet been fully provided or earned. For a franchisee, this figure indicates the amount of future obligations Hck Hot Chicken has to its franchisees or area representatives. Monitoring deferred revenue can provide insights into the company's financial stability and its ability to meet future obligations. A significant decrease in deferred revenue from one year to the next could signal changes in sales, contract terms, or revenue recognition practices, which franchisees may want to investigate further.