What was the purchase of property and equipment by Mr. Sandless in 2023?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 21: FINANCIAL STATEMENTS]
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 charged to expense as incurred. Property and equipment consist of office equipment, computer equipment and automobiles. At December 31, 2023 and 2022 these assets had a book value of $64,898 and $7,290, respectively. Depreciation expense for the years ended December 31, 2022, and 2021 was $11,069 and $13,191, respectively.
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 41–42)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, the company's financial statements include details about property and equipment. The FDD indicates that at December 31, 2023, the book value of Mr. Sandless's property and equipment was $64,898. In comparison, the book value at December 31, 2022, was $7,290.
Depreciation expense for the year ended December 31, 2023, was $11,069. This means the value of Mr. Sandless's assets decreased by this amount due to wear and tear. The depreciation expense for the year ended December 31, 2022, was $13,191.
It's important to note that these figures are based on unaudited financial statements for some periods and audited statements for others. Prospective franchisees should be aware that these figures represent the book value of assets after depreciation, not necessarily the initial purchase price. The FDD specifies that property and equipment include items like office equipment, computer equipment, and automobiles, which are depreciated using the straight-line method over five years.