For The Standardx, where are transaction costs incurred during the period of a completed disposition recognized?

According to The Standardx's 2025 Franchise Disclosure Document, transaction costs incurred during the period of a completed disposition are recognized in gains (losses) on sales of real estate and other. This means that when The Standardx sells off a property or asset, any costs directly related to that sale (such as professional fees) are factored into the overall profit or loss recorded from the transaction. This accounting practice provides a clearer picture of the actual financial impact of such sales on The Standardx's financial statements.

For a prospective franchisee, understanding this accounting treatment is crucial because it affects how The Standardx reports its financial performance. If The Standardx frequently buys and sells properties, the gains or losses from these sales, inclusive of transaction costs, can significantly influence the company's reported income. This, in turn, could impact the perceived financial health and stability of the franchise system. Franchisees should pay attention to these gains or losses, as they can provide insights into The Standardx's strategic decisions regarding asset management and overall profitability.

It's also worth noting that this specific accounting treatment is just one aspect of how The Standardx manages and reports its financial activities. Franchisees should consider this information in conjunction with other financial disclosures in the FDD, such as revenue recognition policies, treatment of contingent consideration, and handling of foreign currency transactions, to gain a comprehensive understanding of The Standardx's financial practices. By carefully reviewing these details, potential franchisees can make more informed decisions about investing in The Standardx franchise system.