What was the allowance at the beginning of the period for Precision Door Service in 2023?
Precision_Door_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
| For the years ended December 31, | 2023 | 2022 |
|---|---|---|
| Allowance, beginning of period | 545 $ | 447 |
| 1,382 | 1,282 | |
| Provisions for bad debts | ||
| (1,364 ) | (1,184 ) | |
| Net write-offs | ||
| $563 | 545 | |
| Allowance, end of period | $ |
Source: Item 23 — Receipts (FDD pages 92–433)
What This Means (2025 FDD)
According to the 2025 Precision Door Service Franchise Disclosure Document, the allowance for Precision Door Service at the beginning of the period in 2023 was $545. This figure represents the company's initial estimate of potential bad debts or uncollectible accounts receivable at the start of that year.
This allowance is a contra-asset account, meaning it reduces the total reported value of accounts receivable on the balance sheet. It reflects Precision Door Service's anticipation that some customers may not pay their outstanding invoices. The provision for bad debts during 2023 was $1,382, while net write-offs totaled $1,364. The allowance at the end of the period was $563.
For a prospective franchisee, understanding these figures provides insight into Precision Door Service's financial management and its approach to handling potential credit risks. While the specific allowance for bad debts may fluctuate from year to year, consistent monitoring of these figures can help franchisees assess the overall financial health and stability of the franchise system.