What was the allowance for credit losses for Precision Door Service at the end of 2023?
Precision_Door_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
| as of December 31, 2023 and allowance for | | | | doubtful accounts of $379 as of December 31, 2022 | | | | Total trade notes receivable, net | $ 24,751 | $ 25,730 |
Notes to Combined Financial Statements ($000's)
An analysis of the changes in trade notes receivable is as follows:
| For the years ended December 31, | 2023 | 2022 | |------------------------------------------------|--------------------|----------| | | | | | Balance at beginning of period | $ 26,275 $ | 28,389 | | Notes receivable, contributed, net | 1,652 | - | | Principal payments received | (16,293) | (13,699) | | Notes issued | 15,050 | 12,808 | | Net write-offs | (1,370) | (1,223) | | Gross trade notes receivable, at end of period | 25,314 | 26,275 | | Allowance for credit losses | (563) | - | | Allowance for doubtful accounts | - | (545) | | Net trade notes receivable, at end of period | $ 24,751 $ | 25,730 | An analysis of the changes in the trade notes receivable allowance is as follows:
| For the years ended December 31, | 2023 | 2022 |
|---|---|---|
| Allowance, beginning of period | $ 545 | $ 447 |
| Provisions for bad debts | 1,382 | 1,282 |
| Net write-offs | (1,364) | (1,184) |
| Allowance, end of period | $ 563 | $ 545 |
| Scheduled future maturities of trade notes receivable are as follows: |
| --------------------------- | -- |
|---|
| 2024 2025 2026 2027 2028 Thereafter | $ 9,619 4,795 3,965 2,882 2,085 1,968 |
|---|---|
| $ 25,314 |
Notes to Combined Financial Statements ($000's)
7. Property and Equipment
A summary of property and equipment as of December 31 is as follows:
| 2023 | 2022 | |
|---|---|---|
| Machinery and equipment | $ 6,303 | 5,523 |
| Software | $ 11,035 | 6,831 |
| Vehicles | 9,614 | 8,539 |
| Total property and equipment | 26,952 | 20,893 |
| Less accumulated depreciation | (8,173) | (2,614) |
| Property and equipment – | $ 18,779 | 18,279 |
| net | $ |
Depreciation expense was $5,092 for the year ended December 31, 2023 and $1,656 for the year ended December 31, 2022.
8. Related Party Transactions
The Company has material ongoing transactions with the Manager and other direct and indirect subsidiaries of the Manager.
Source: Item 21 — Financial Statements (FDD page 91)
What This Means (2025 FDD)
According to Precision Door Service's 2025 Franchise Disclosure Document, there are multiple allowances for credit losses reported for the year ending December 31, 2023, depending on the specific type of receivable being evaluated.
For trade notes receivable, the allowance for credit losses at the end of 2023 was $563,000. This figure represents the company's estimate of the portion of its trade notes receivable that may not be collectible. Trade notes receivable arise from Precision Door Service's financing of customer purchases.
Additionally, the FDD provides information on the allowance for credit losses related to amounts due within one year and amounts due after one year. For amounts due within one year, the allowance for credit losses as of December 31, 2023, was $89,000. For amounts due after one year, the allowance for credit losses as of December 31, 2023, was $474,000. Finally, another table shows that the allowance for credit losses as of December 31, 2023 was $117,000 for amounts due within one year and $542,000 for amounts due after one year. These figures are important for assessing the overall financial health and risk associated with Precision Door Service's receivables.