What comprised the accounts receivable for Noodles & Company, and what was the bad debt expense recognized in 2023?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
standing checks at year end are in excess of cash and cash equivalents. Such book overdrafts are recorded within accounts payable in the accompanying Consolidated Balance Sheets and within operating activities in the accompanying Consolidated Statements of Cash Flows.
Accounts Receivable
Accounts receivable consists primarily of franchise receivables and vendor rebates, as well as insurance receivables and other miscel
Source: Item 22 — CONTRACTS (FDD pages 98–99)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, the accounts receivable primarily consist of franchise receivables, vendor rebates, insurance receivables, and other miscellaneous receivables arising from the normal course of business. As of both December 31, 2024, and January 2, 2024, Noodles & Company believed all amounts to be collectible, and therefore, no allowance for doubtful accounts was recorded.
In 2023, Noodles & Company recognized $0.5 million in bad debt expense. This indicates that while the company generally expects to collect its receivables, it did experience some uncollectible debts during that fiscal year.
For a prospective franchisee, this information is relevant in understanding the financial practices of Noodles & Company. The composition of accounts receivable gives insight into the sources of revenue and potential collection challenges. The bad debt expense indicates the level of risk associated with these receivables and the company's approach to managing credit and collections. Franchisees may want to inquire about the specific types of 'other miscellaneous receivables' and the typical terms and collection periods for franchise and vendor receivables to better assess their own potential financial exposure.