How much cash did Zoomin Groomin's depreciation and amortization contribute in 2023?
Zoomin_Groomin Franchise · 2025 FDDAnswer from 2025 FDD Document
-----| | Member Contributions | - | | Member Distributions | - | | Net Income (Loss) | (482,370) | | Equity at December 31, 2022 | $ (693,256) | | Equity at January 1, 2023 | $ (693,256) | | Member Contributions | - | | Member Distributions | - | | Net Income (Loss) | (1,117,726) | | Equity at December 31, 2023 | $ (1,810,982) | | Equity at January 1, 2024 | $ (1,810,982) | | Member Contribut
Source: Item 9 — 01. Financial Statements and Exhibits. (FDD pages 68–156)
What This Means (2025 FDD)
According to Zoomin Groomin's 2025 Franchise Disclosure Document, the company's depreciation and amortization contributed $6,000 in 2023. This figure is part of the adjustments made to reconcile net loss to net cash provided by operating activities.
Depreciation and amortization are non-cash expenses, meaning they don't involve an actual outflow of cash. Instead, they represent the reduction in value of assets (like equipment or vehicles) over time. In the context of cash flow statements, these expenses are added back to net loss because they reduced the company's reported profit without affecting its cash position. For Zoomin Groomin, this adjustment provides a more accurate view of the cash generated from its core business operations.
For a prospective Zoomin Groomin franchisee, understanding these adjustments is crucial for assessing the financial health and cash-generating potential of the franchisor. While a net loss might seem concerning, the add-back of depreciation and amortization can paint a different picture, indicating that the business is generating cash despite the accounting loss. This is a common practice in financial analysis and provides a more complete understanding of the company's financial performance.