What was the cash balance at the beginning of 2021 for Hyper Kidz?
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 cash balance at the beginning of 2021 was $2,942. This figure is derived from the statement of cash flows, which provides a summary of the cash inflows and outflows of Hyper Kidz over a period of time. The cash flow statement details the beginning and ending cash balances for 2020, 2021, and 2022.
For a prospective Hyper Kidz franchisee, understanding the franchisor's cash flow is crucial. The beginning cash balance indicates the company's liquidity at the start of the year, which can be used to assess its ability to meet short-term obligations and invest in growth opportunities. A higher beginning cash balance generally suggests a stronger financial position.
It is important to note that this cash balance reflects the financial position of the franchisor, Boomerang Franchise, LLC, and not necessarily the performance of individual franchise locations. While the franchisor's financial health can indirectly impact franchisees, prospective franchisees should also focus on the financial projections and performance data specific to the franchise opportunity they are considering. Reviewing the cash flow statements over multiple years provides a more comprehensive understanding of the franchisor's financial trends and stability.