Segment Reporting:

9 Months Ended

Sep. 29, 2018

13. Segment Reporting:

The Company currently has two reportable business segments, franchising and leasing. The franchising segment franchises value-oriented retail store concepts that buy, sell, trade and consign merchandise, as well as provides strategic consulting services related to franchising. The leasing segment includes (i) Winmark Capital Corporation, a middle-market equipment leasing business and (ii) Wirth Business Credit, Inc., a small ticket financing business. Segment reporting is intended to give financial statement users a better view of how the Company manages and evaluates its businesses. The Company’s internal management reporting is the basis for the information disclosed for its business segments and includes allocation of shared-service costs. Segment assets are those that are directly used in or identified with segment operations, including cash, accounts receivable, prepaid expenses, inventory, property and equipment and investment in leasing operations. Unallocated assets include corporate cash and cash equivalents, current and deferred tax amounts and other corporate assets. Inter-segment balances and transactions have been eliminated. The following tables summarize financial information by segment and provide a reconciliation of segment contribution to operating income:


	Three Months Ended				Nine Months Ended
	September 29, 2018		September 30, 2017		September 29, 2018		September 30, 2017
Revenue:
Franchising	$	14,509,900	$	13,815,100	$	40,444,800	$	38,249,500
Leasing		4,608,600		3,915,800		14,994,500		13,722,000
Total revenue	$	19,118,500	$	17,730,900	$	55,439,300	$	51,971,500

Reconciliation to operating income:
Franchising segment contribution	$	9,064,900	$	8,332,900	$	23,264,900	$	21,544,600
Leasing segment contribution		2,370,400		1,706,600		8,319,300		6,621,400
Total operating income	$	11,435,300	$	10,039,500	$	31,584,200	$	28,166,000

Depreciation and amortization:
Franchising	$	60,300	$	66,300	$	178,200	$	211,200
Leasing		18,300		20,700		55,500		64,500
Total depreciation and amortization	$	78,600	$	87,000	$	233,700	$	275,700


	As of
	September 29, 2018		December 30, 2017
Identifiable assets:
Franchising	$	4,061,400	$	4,051,400
Leasing		45,981,600		42,153,600
Unallocated		451,500		2,637,000
Total	$	50,494,500	$	48,842,000