What was the reported amortization of right-of-use assets for Monicals Pizza in 2023?

According to Monicals Pizza's 2025 Franchise Disclosure Document, the amortization of right-of-use assets related to finance leases was $378,130 in 2023. This figure reflects the expense recognized for the use of leased assets under finance lease agreements during that year. In addition, the document states that the interest on lease liabilities was $34,864 and the operating lease expense was $906,435 for 2023. The total lease expense for 2023 was $1,319,429.

For a prospective Monicals Pizza franchisee, understanding these figures is crucial for assessing the financial obligations associated with leasing property and equipment. Amortization of right-of-use assets represents a non-cash expense that impacts the franchisee's profitability. It is important to note that the operating right-of-use assets and lease liabilities were calculated using a weighted average discount rate of 2.10% for the year ended December 31, 2023, with a weighted average remaining lease term for operating leases of 7.92 years. The finance right-of-use assets and lease liabilities were calculated using a weighted average discount rate of 3.30% for the year ended December 31, 2023, with a weighted average remaining lease term for finance leases of 3.50 years.

These lease-related expenses can significantly affect the overall financial performance of a Monicals Pizza franchise. Franchisees should carefully review the terms of their lease agreements and consider these amortization and interest expenses when projecting their operating costs and profitability. Understanding the distinction between finance and operating leases, as well as the factors influencing the discount rates and lease terms, is essential for making informed financial decisions. Prospective franchisees should consult with financial advisors to fully grasp the implications of these lease-related expenses on their investment.