Profitability Effect and n Asset Structure to Structure Capital in Manufacturing Companies in Indonesia Stock Exchange

Abstract

The purpose of this research is to develop and retest previous research that is suspected to have an influence among variables, regarding the influence of profitability and asset structure on the capital structure. This research took an empirical study on consumption sub-sector manufacturing companies listed on the Indonesia Stock Exchange for the period 2017 to 2019. Test the profitability variable using the ROA (Return on Assets) formula. The asset structure variable uses the fixed asset division formula with total assets and the capital structure variable uses the DER (Debt to Equity Ratio) formula. This research uses quantitative research and data taken in the form of annual financial reports and the method used in this research is the purposive sampling method which is a research that takes samples using criteria points, where the number of samples for this study is 14 companies. This study used multiple linear regression analysis techniques with IBM SPSS. Based on research showing that the relationship of profitability (X1) in the capital structure in partial output results in negative and insignificant, along with the relationship of asset structure (X2) in the capital structure in partial output results are significantly positive. From the results of the regression equation that the structure of assets and profitability in simultaneous output results both have a significant influence on the capital structure.