What was the outstanding balance on Kitchen Solvers' line of credit as of December 31, 2022?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2024 | 2023 | 2022 | ||||
|---|---|---|---|---|---|---|
| Contract liabilities - Net of contract assets, | ||||||
| beginning | $ 582,519 | $ | 518,363 | $ | 437,293 | |
| Initial franchise fee revenue recognized | (259,581) | (232,748) | (193,048) | |||
| Contract costs recognized | 138,404 | 120,154 | 105,366 | |||
| New contract costs paid | (200,000) | (228,250) | (292,000) | |||
| Collections of initial franchise fees | 488,991 | 405,000 | 460,752 | |||
| Contract liabilities - Net of contract assets, | ||||||
| ending | $ 750,333 | $ | 582,519 | $ | 518,363 |
**Note
Source: Item 21 — Financial Statements (FDD pages 48–49)
What This Means (2025 FDD)
According to Kitchen Solvers' 2025 Franchise Disclosure Document, the company had a revolving loan agreement with a local financial institution amounting to $100,000. As of December 31, 2022, the outstanding advances on this line of credit totaled $0. This indicates that Kitchen Solvers had access to a line of credit but did not utilize it during that period. The FDD also confirms that the outstanding balance was also $0 as of December 31, 2023 and 2024.
For a prospective Kitchen Solvers franchisee, this information suggests that the franchisor has been able to manage its finances without needing to draw upon its line of credit in recent years. This could be viewed as a sign of financial stability. However, it is important to note that a line of credit is there if needed, and the availability of the $100,000 line could provide a safety net for unforeseen circumstances.
It is worth noting that while the FDD provides a snapshot of Kitchen Solvers' financial situation, it is essential for potential franchisees to conduct their own due diligence. This includes reviewing the complete financial statements, consulting with financial advisors, and assessing their own risk tolerance before making any investment decisions. Understanding the franchisor's financial health is a critical component of evaluating the overall franchise opportunity.