What was the depreciation expense for Mr. Sandless in 2022?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
was $82,500 and $110,000, respectively.
The Company periodically receives funds from its members' or related companies. These advances are due on demand and do not bear interest. As of December 31, 2022, and 2021, the amount due to a related party was $300 and $14,224, respectively.
6. PROPERTY AND EQUIPMENT
Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful life of the asset, which is five years. Expenditures for repairs and maintenance are charge
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 41–42)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, the depreciation expense for the year ending December 31, 2022, was $13,191. This figure reflects the reduction in value of Mr. Sandless's property and equipment, which includes items like office equipment, computer equipment, and automobiles.
Mr. Sandless calculates depreciation using the straight-line method over an estimated useful life of five years for its assets. This accounting method evenly distributes the cost of an asset over its useful life, providing a consistent depreciation expense each year, assuming no changes in the asset's value or estimated life.
Prospective franchisees should understand how depreciation impacts Mr. Sandless's financial statements, as it affects the company's reported profits and asset values. Reviewing depreciation trends over several years can offer insights into Mr. Sandless's investment in and management of its assets. It's also important to note that these financial statements are prepared without an audit, so prospective franchisees should consider this when evaluating the data.