What depreciation method does Pump It Up use for property and equipment?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
Property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets as follows:
Office Furniture and Equipment 5 to 7 Years Computers and Software 3 to 5 Years Leasehold Improvements Lesser of Lease Term or Useful Life
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, the company uses the straight-line method to depreciate its property and equipment. This means the cost of an asset is evenly distributed over its useful life.
The estimated useful lives of the assets are as follows: Office furniture and equipment are depreciated over 5 to 7 years. Computers and software are depreciated over 3 to 5 years. Leasehold improvements are depreciated over the lesser of the lease term or the useful life of the improvement.
For a prospective Pump It Up franchisee, understanding the depreciation method is important for financial planning and tax purposes. The straight-line method is a common and simple way to calculate depreciation, making it easier to forecast expenses related to these assets. Franchisees should consult with a financial professional to understand the specific implications of depreciation on their business's profitability and tax obligations.