Effects Of Current Ratio And Debt-To-Equity Ratio On Return On Asset And Return On Equity

Lusy, Lusy and Hermanto, Y. Budi and Panjaitan, Thyophoida W.S. and Widyastuti, Maria (2018) Effects Of Current Ratio And Debt-To-Equity Ratio On Return On Asset And Return On Equity. International Journal of Business and Management Invention (IJBMI), 7 (12ver2). pp. 31-39. ISSN 2319-8028

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Abstract

The purpose of a company is to gain profits. The purpose of the present study was to examine the effects of current ratio and debt-to-equity ratio on return on asset and return on equity for companies of the food and noodle sub-sector. A total of 10 companies listed on the Indonesia Stock Exchange (ISX) was sampled from 2014 to 2017. Data were processed using the multiple linear regression analysis with SPSS 24. Results showed that current ratio and debt-to-equity ratio had a significant effect on return on equity and return on asset. Results of the regression coefficient analysis showed that current ratio and debt-to-equity ratio accounted for 14.9% of ROA, while the remaining 85.1% was explained by other variables, as indicated by the coefficient determinants. The regression coefficient analysis for ROE showed that 61.4% was explained by other variables not studied in this research. Results of the F-test showed a significance value of 0.019 < 0.05 for ROA and 0.000 < 0.05 for ROE, meaning that both the current ratio and debt-to-equity ratio had a significant effect on ROA and ROE in food and beverage industry companies listed in Indonesia Stock Exchange.

Item Type:	Article
Uncontrolled Keywords:	current ratio, debt-to-equity ratio, return on assets, return on equity
Subjects:	H Social Sciences > HB Economic Theory
Divisions:	Fakultas Ekonomi > Prodi Manajemen
Depositing User:	Yustinus Budi Hermanto
Date Deposited:	04 Jun 2020 08:16
Last Modified:	27 May 2022 04:16
URI:	http://repositori.ukdc.ac.id/id/eprint/225

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