Royalties and Fees	3 Months Ended
Mar. 31, 2022
Royalties and Fees
Note 2 - Royalties And Fees	Note 2 – Royalties and fees included initial franchise fees of $83,000 for the three-month period ended March 31, 2022, and $54,500 for the three-month period ended March 31, 2021. Royalties and fees included equipment commissions of $8,007 for the three-month period ended March 31, 2022, and $10,438 for the three-month period ended March 31, 2021. Royalties and fees, including amortized initial franchise fees and equipment commissions, were $883,000 for the three-month period ended March 31, 2022, and $989,000 for the three-month period ended March 31, 2021. Most of the cost for the services required to be performed by the Company are incurred prior to the franchise fee income being recorded, which is based on a contractual liability of the franchisee. The effect on comparable period amounts within the financial statements by recording franchise fees and cost of opening the units as deferred contract costs and deferred contract income is not material as the initial franchise fee for the non-traditional franchise is intended to defray the initial contract costs, and the franchise fees and contract costs initially incurred and paid approximate the relative amortized franchise fees and contract costs for those same periods. The deferred contract income and deferred costs were $852,000 on March 31, 2022. At December 31, 2021 and March 31, 2022, the carrying values of the Company’s franchise receivables have been reduced to anticipated realizable value. After considering this reduction of carrying value, the Company anticipates that substantially all of its accounts receivables reflected on the consolidated balance sheet as of March 31, 2022, will be collected. In 2020, in light of the additional uncertainty created as a result of the COVID 19 pandemic, the Company created an allowance for collectability on all long-term franchisee receivables. The Company will continue to pursue collection where circumstances are appropriate and all collections of these receivables in the future will result in additional royalty income at the time received. There were 3,069 franchises/licenses in operation on December 31, 2021 and 3,074 franchises/licenses were in operation on March 31, 2022. During the three-month period ended March 31, 2022 seven new outlets opened and two outlets closed. In the ordinary course, grocery stores from time to time add the Company’s licensed products, remove them and may subsequently re-offer them. Therefore, it is unknown how many of the 2,404 licensed grocery store units included in the counts above have left the system.

Royalties and Fees

3 Months Ended

Mar. 31, 2022

Note 2 – Royalties and fees included initial franchise fees of $83,000 for the three-month period ended March 31, 2022, and $54,500 for the three-month period ended March 31, 2021. Royalties and fees included equipment commissions of $8,007 for the three-month period ended March 31, 2022, and $10,438 for the three-month period ended March 31, 2021. Royalties and fees, including amortized initial franchise fees and equipment commissions, were $883,000 for the three-month period ended March 31, 2022, and $989,000 for the three-month period ended March 31, 2021. Most of the cost for the services required to be performed by the Company are incurred prior to the franchise fee income being recorded, which is based on a contractual liability of the franchisee.

The effect on comparable period amounts within the financial statements by recording franchise fees and cost of opening the units as deferred contract costs and deferred contract income is not material as the initial franchise fee for the non-traditional franchise is intended to defray the initial contract costs, and the franchise fees and contract costs initially incurred and paid approximate the relative amortized franchise fees and contract costs for those same periods.

The deferred contract income and deferred costs were $852,000 on March 31, 2022.

At December 31, 2021 and March 31, 2022, the carrying values of the Company’s franchise receivables have been reduced to anticipated realizable value. After considering this reduction of carrying value, the Company anticipates that substantially all of its accounts receivables reflected on the consolidated balance sheet as of March 31, 2022, will be collected. In 2020, in light of the additional uncertainty created as a result of the COVID 19 pandemic, the Company created an allowance for collectability on all long-term franchisee receivables. The Company will continue to pursue collection where circumstances are appropriate and all collections of these receivables in the future will result in additional royalty income at the time received.

There were 3,069 franchises/licenses in operation on December 31, 2021 and 3,074 franchises/licenses were in operation on March 31, 2022. During the three-month period ended March 31, 2022 seven new outlets opened and two outlets closed. In the ordinary course, grocery stores from time to time add the Company’s licensed products, remove them and may subsequently re-offer them. Therefore, it is unknown how many of the 2,404 licensed grocery store units included in the counts above have left the system.