The Impact Of Working Capital Management And Ratio Finance On Profitability In The Manufacture

Purba, Jan Horas Veryady and Argoputro, Stanislaus Bandung and Hasibuan, David HM and Setiawan, Hendra (2024) The Impact Of Working Capital Management And Ratio Finance On Profitability In The Manufacture. International Journal of Progressice Sciences and Technologies, 45 (2). pp. 554-565. ISSN 2509-0119

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Abstract

The company's profitability is one of the magnets used by investors to invest their funds. Every investor who invests expects to profit from the investment he chooses in the long term. This advantage can be obtained if you look at the intricacies of the company's achievements in terms of profitability. One important component that is generally looked at as one of the causes that motivates investors to invest and becomes an acquisition in the courage of investors to take risks on the investment they have chosen is the value of the company's ROE (return on equity). Return on equity is identified as tied to the company's performance because this includes an illustration of the value of a company regarding the achievement of net income when viewed from the perspective of the equity it owns. The movement in the value of profitability should be the main focus for investors looking to invest their funds in the stock exchange. Therefore, the level of the company's ability to earn profits is one of the benchmarks against which investors should invest. The aim of the study was to determine the extent to which working capital management and financial ratios, namely account receivable turnover, working capital turnover, current ratio, and debt-to-equity ratio, have an effect on return on equity in basic and chemical industry sub-sectors companies listed on the Indonesia Stock Exchange for the period 2016–2021. The results of the study shows that Accounts Receivable Turnovers, Working Capital Turnovers, Current Ratio, and Debt to Equity Ratio to Return on Equity do not have a significant effect with a significance value of 0.919 > 0.05, and partially there is no significant effect on Return on Equity between Accounts Receivable Turnovers with a significance value of 0.9937 > 0.05, Working Capital Turnover with a significant value of 0.8594 > 0.05, Current Ratio (CR) with a significant value of 0.3650 > 0.05, and also partially there is no significant effect on the Debt to Equity Ratio with a significance value of 0.619 > 0.05. Keywords—account receivable turnovers; working capital turnovers; current ratio; debt to equity ratio

Item Type:	Article
Subjects:	H Social Sciences > H Social Sciences (General)
Divisions:	Faculty of Law, Arts and Social Sciences > School of Management
Depositing User:	Admin Repository
Date Deposited:	15 Aug 2024 01:42
Last Modified:	15 Aug 2024 01:42
URI:	http://repository.ibik.ac.id/id/eprint/1823

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