What was Learningrx's net income before income taxes for the year ended September 30, 2024?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
horized, issued, and outstanding | 50,000 | 50,000 | | |---|---|---|---| | Retained earnings | 942,514 | 773,206 | | | Total Stockholders' Equity | 992,514 | 823,206 | | | Total Liabilities and Stockholders' Equity | $ 1,433,773 | | $ 1,193,151 |
3. Income Taxes
Current taxes are computed using the cash basis of accounting. Current taxable net income (loss) prior to the use of net operating losses, was $235,000 and $14,689 for the years ended September 30, 2024 and 2023, respectively. As of September 30, 2024, the Corporation has federal net operating losses (NOL) to be carried to future yea
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
Based on the 2025 Learningrx Franchise Disclosure Document, the company's current taxable net income prior to the use of net operating losses was $235,000 for the year ended September 30, 2024. This figure is calculated using the cash basis of accounting.
It's important to note that this taxable net income is 'prior to the use of net operating losses.' Learningrx had federal net operating losses (NOL) to be carried to future years of approximately $930,000 as of September 30, 2024. These NOLs can be used to offset future taxable income, potentially reducing Learningrx's tax liability in subsequent years.
Furthermore, the document mentions deferred income taxes, which represent the future tax benefit to be reported using the accrual basis of accounting. These deferred taxes arise from differences in depreciation methods and NOL carryforwards. This indicates that Learningrx uses different accounting methods for tax purposes (cash basis) and financial reporting (accrual basis), which is a common practice. A prospective franchisee should consult with a financial advisor to understand the implications of these accounting methods and NOL carryforwards on Learningrx's financial performance and tax obligations.