Examining the Impact of Leverage and Liquidity on Corporate Performance

Diana Supriati, Diana Examining the Impact of Leverage and Liquidity on Corporate Performance. atlantis-press.

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Abstract

Abstract Food and beverage industry has a significant role in economic growth in Indonesia. The Ministry of Industry estimates that the growth of the food and beverage industry will slow down after becoming the main driver of industrial growth throughout 2016. The main objective of the study is to determine the effect of capital structure and liquidity towards profitability and its impact towards the financial performance of food and beverage companies in Indonesia. To achieve the objectives, the quantitative method was used and data were collected through financial statement data in Indonesia Stock Exchange. A total of 11 food and beverage companies in Indonesia were taken by using financial report data between 2012-2016. The data were analyzed using statistic package for social science version 22.0. The findings exhibited through regression analysis and path analysis, the finding revealed that there is a significance influence of liquidity towards profitability. Another finding showed that there is most significance influence of profitability towards financial performance. Furthermore, another finding revealed that indirectly capital structure through profitability has a significance influence towards financial performance and also indirectly capital structure through profitability has a significance influence towards financial performance. The finding suggests management to increase shareholder confidence by showing good company performance through level of current ratio. It also suggests investors to analyze the financial ratios, especially that affects the value of the company before making investment. Lastly, this study gives contribute in both theoretical and managerial implication to achieve greater corporate financial performance.

Item Type:	Other
Subjects:	Z Bibliography. Library Science. Information Resources > ZA Information resources > ZA4450 Databases
Depositing User:	Bynur Ghazali
Date Deposited:	05 Jan 2021 09:39
Last Modified:	05 Jan 2021 09:39
URI:	http://repository.stei.ac.id/id/eprint/2865

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