Academy of Accounting and Financial Studies Journal (Print ISSN: 1096-3685; Online ISSN: 1528-2635)


Determinants of Capital Structure and Firm Financial Performance: Empirical Evidence on Food and Beverage Sector in Indonesian Listed Companies

Author(s): Niken Wahyu Cahyaningtyas, Harjum Muharam

The purpose of this study is to provide additional literature based on factors affecting company performance. Examining the role of company size, liquidit, and asset structure in improving the company’s financial performance, which is mediated by the company’s capital structure. The quantitative research was conducted at food and beverage companies listed on the Indonesia Stock Exchange (IDX). The sample contains financial data from 15 companies in the food and beverage for the 2014-2019 period. Data were analyzed using Statistical Product and Services Solutions (SPSS) Version 21 software. The result showed that the food and beverage companies listed on the Indonesia Stock Exchange (IDX) had a higher rate, liquidity rati, and asset structure that support the firm level. Meanwhile, company size, liquidity, and asset structure that are mediated by funding are proven to be able to improve the company’s financial performance. This study explores and extends the findings of previous studies that test firms size. Liquidit, and asset structure affect the capital structure and further improve the performance of financial firms. The findings of this study allow financial managers to be careful in the degree of oversight of the company. The bigger the company of course has the opportunity to get bigger debt. Good corporate funding can improve company performance. The capital structure of a company that is well managed taking into account the size of the company, liquidity and asset structure makes the company healthy and has the superior financial performance.

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