What was the reported total lease expense for Monicals Pizza in 2023?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
| December 31, 2023 and 2022: | |||
|---|---|---|---|
| 2023 | 2022 | ||
| Finance lease expense: | |||
| Amortization of right-of-use assets | $ 378,130 | $ 219,501 | |
| Interest on lease liabilities | 34,864 | 16,152 | |
| O perating lease expense | 906,435 | 900,379 | |
| Total lease expense | $ 1,319,429 | $ 1,136,032 |
Source: Item 23 — RECEIPTS (FDD pages 46–257)
What This Means (2025 FDD)
According to Monicals Pizza's 2025 Franchise Disclosure Document, the total lease expense for the company in 2023 was $1,319,429. This figure encompasses several components, including the amortization of right-of-use assets related to finance leases, interest on lease liabilities, and operating lease expenses.
Breaking down the total, the amortization of right-of-use assets was $378,130, representing the expense associated with the use of assets under finance lease agreements. Interest on lease liabilities amounted to $34,864, reflecting the cost of borrowing for these leases. The operating lease expense, which covers the cost of leasing property used in the business, was $906,435.
For a prospective Monicals Pizza franchisee, understanding these lease expenses is crucial. Lease expenses are a significant overhead cost for any restaurant business, and these figures provide insight into the scale of these expenses for company-owned locations. While a franchisee's specific lease costs will depend on their location and lease terms, this information offers a benchmark for evaluating potential profitability and managing financial planning.
It's important to note that these figures represent the consolidated expenses for Monicals Pizza Corporation and its subsidiaries. A franchisee should compare these figures with their own projected revenues and expenses to determine the financial viability of their specific franchise location. Additionally, franchisees should consult with financial advisors to fully understand the implications of lease agreements and related expenses.