What was the reported value of Kitchen Solvers' equipment and fixtures on December 31, 2024?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
al statements as a whole.
Hancock & Robinson CPAs
La Crosse, Wisconsin
March 7, 2025
Balance Sheets
December 31, 2024, 2023, and 2022
| Assets | 2024 | 2023 | 2022 |
|---|---|---|---|
| Current assets: | |||
| Cash | $ 409,936 | $ 192,541 | $ 60,708 |
| Accounts receivable | 63,672 | 138,673 | 140,562 |
| Accounts receivable - related party | 174,152 | - | - |
| Contract assets - Current | 138,404 | 118,404 | 98,129 |
| Advances receivable | - | - | 74,472 |
| Other receivable | - | - | 3,260 |
| Inventory | 28,642 | 14,106 | - |
| Prepaid expenses | 2,277 | 2,293 | - |
| Total current assets | 817,083 | 466,017 | 377,131 |
| Property and equipment: | |||
| Equipment and fixtures | 34,201 | 34,201 | 34,201 |
| Technology equipment and software | 109,640 | 109,640 | 109,640 |
| Machinery and equipment | 86,429 | 73,253 | - |
| Vehicles | 6,500 | - | - |
| Leasehold improvements | 33,841 | - | - |
| Totals | 270,611 | 217,094 |
Source: Item 21 — Financial Statements (FDD pages 48–49)
What This Means (2025 FDD)
According to Kitchen Solvers' 2025 Franchise Disclosure Document, the value of equipment and fixtures as of December 31, 2024, was $34,201. This figure represents the original cost of the equipment and fixtures before any accumulated depreciation is factored in. It's important to note that this value does not reflect the current market value or the depreciated value of these assets.
For a prospective Kitchen Solvers franchisee, this number provides a baseline understanding of the investment Kitchen Solvers has in its physical assets. However, it's crucial to consider the accumulated depreciation, which was ($156,768) as of the same date, to understand the net value of all property and equipment, which is $113,843. This net value gives a more accurate picture of the company's tangible assets.
Understanding the difference between the original cost and the depreciated value is vital for assessing the financial health and capital expenditure requirements of Kitchen Solvers. A franchisee should inquire about the age and condition of the equipment and fixtures, as well as the company's policies on equipment replacement and upgrades. This information will help in forecasting future capital expenditures and understanding the ongoing investment needed to maintain the franchise's operational capabilities.
It is also worth noting that the depreciation method used by Kitchen Solvers is the straight-line method, with useful lives ranging from 5 to 40 years. This method evenly distributes the cost of the asset over its useful life. The depreciation expense for 2024 was $10,880, which is an important factor in understanding the company's profitability and cash flow.