Discontinued Operations, Exit Activities, and Clinic Obligations (Tables)

3 Months Ended

Mar. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures

The following is a summary of the Company’s operating results for discontinued operations for the three months ended March 31, 2015 and 2014:

	2015		2014
Revenue	$	-	$	7,296,000
Income/(loss) before income taxes from discontinued operations		45,000		(924,000)
Income tax/(benefit) provision		17,000		(346,000)
Income/(loss) from discontinued operations, net of tax	$	28,000	$	(578,000)

The following table presents the aggregate carrying amounts of the major classes of assets and liabilities divested as of March 31, 2015 included in discontinued operations:

	2015
ASSETS
Current assets:
Receivables, net	$	14,000
Inventory		-
Prepaid expenses and other current assets		4,000
Total current assets		18,000
Other assets		19,000
Total assets	$	37,000
LIABILITIES
Current liabilities:
Accounts payable and accrued expenses	$	2,348,000
Total current liabilities		2,348,000
Long-term lease obligations		1,712,000
Total liabilities	$	4,060,000

Schedule of Accrued Liabilities

The following table summarizes the exit obligations primarily closed clinic lease obligations, severance accruals, and customer refunds incurred as of March 31, 2015:

Ending accrued balance as of December 31, 2014	$	6,534,000
Charges incurred during the period		-
Adjustments recorded during the period (1)		(549,000)
Payments during the period		(2,042,000)
Ending accrued balance as of March 31, 2015	$	3,943,000
(1)- The adjustments to the accrual recorded in the first quarter of 2015 relate primarily to favorable termination agreements reached with landlords of closed Corporate Medifast Weight Control Centers.
These charges were recorded in the balance sheet as of March 31, 2015 as follows:
Total current liabilities of discontinued operations	$	2,231,000
Total long-term liabilities of discontinued operations		1,712,000
Ending accrued balance as of December 31, 2014	$	3,943,000