What was the beginning cash balance for Hyper Kidz in 2022?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
68 | | 1,468 | | Net income | | 52,292 | | | | - | | BALANCE, DECEMBER 31, 2022 | $ | 55,630 | $ | (176,919) | $ | (173,581) |
FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020 BOOMERANG FRANCHISE, LLC STATEMENTS OF CASH FLOWS
| 2022 | 2021 | 2020 | |
|---|---|---|---|
| CASH FLOWS FROM OPERATING ACTIVITIES | |||
| Net income) | $ 52,292 | $ 46,173 | $ 110,241 |
| Adjustments to reconcile net income to net | |||
| cash provided by operating activities: | |||
| Recognition of non-refundable deferred franchise sales | (4,279) | (3,950) | (6,913) |
| Changes in assets and liabilities: | |||
| Accounts receivable | (18,006) | ||
| Accrued expense | 2,993 | 820 | - |
| Royalties collected in advance | (36,612) | 36,612 | - |
| Non-refundable deferred franchise fees | 39,500 | ||
| Net cash provided by operating activities | 35,888 | 79,655 | 103,328 |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||
| Proceeds from notes payable | - | 79,000 | - |
| Advances to affiliates, net | 1,468 | (163,377) | - |
| Member contributions | - | 1,800 | - |
| Member distributions | (30,000) | - | (100,386) |
| Net cash (used) by financing activities | (28,532) | (82,577) | (100,386) |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 52)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, the beginning cash balance for 2022 was $20. This figure is derived from the cash flow statements presented in the FDD, which provide a historical overview of the company's financial performance. Understanding the cash flow is crucial for prospective franchisees as it offers insights into the company's liquidity and how it manages its finances.
Specifically, the cash flow statement details the movement of cash both into and out of the company, categorizing these flows into operating, financing, and investing activities. The beginning cash balance serves as the starting point for this analysis, indicating the amount of cash Hyper Kidz had at its disposal at the start of the fiscal year. For Hyper Kidz, the increase in cash during 2022 was $7,356, resulting in an ending cash balance of $7,376.
For a potential Hyper Kidz franchisee, this information is valuable in assessing the financial stability and growth trajectory of the company. While a single year's cash flow data provides a snapshot, reviewing multiple years, as presented in the FDD, offers a more comprehensive understanding of the company's financial health and its ability to manage cash effectively. This, in turn, can inform the franchisee's decision-making process and financial planning.