Research Article
Does Profitability moderate the relationship of Interest Rate, Ratio Tangible Assets, Firm Size on Capital Structure
@INPROCEEDINGS{10.4108/eai.18-7-2019.2288571, author={Irawan Irawan and Muhammad Dharma Tuah Putra Nasution and Yossie Rossanty}, title={Does Profitability moderate the relationship of Interest Rate, Ratio Tangible Assets, Firm Size on Capital Structure}, proceedings={Proceedings of The 2nd International Conference On Advance And Scientific Innovation, ICASI 2019, 18 July, Banda Aceh, Indonesia}, publisher={EAI}, proceedings_a={ICASI}, year={2019}, month={11}, keywords={interest rate ratio tangible assets firm size profitability capital structure}, doi={10.4108/eai.18-7-2019.2288571} }- Irawan Irawan
Muhammad Dharma Tuah Putra Nasution
Yossie Rossanty
Year: 2019
Does Profitability moderate the relationship of Interest Rate, Ratio Tangible Assets, Firm Size on Capital Structure
ICASI
EAI
DOI: 10.4108/eai.18-7-2019.2288571
Abstract
The purpose of this study is to examine the effect of interest rate, asset structure, firm size, and profitability on the capital structure simultaneously and partially in firms of miscellaneous industry sector listed on the Indonesia Stock Exchange (IDX) and to test the effect of profitability moderate factors affecting capital structure. The population of this study is thirty-eight companies based on in firms of miscellaneous industry sector listed on the Indonesia Stock Exchange (IDX) for the 2010-2014 period. Determination of sample research using purposive sampling method with the number of 23 companies related to criteria. The results of the study prove that BI rate, Ratio Tangible Assets, Firms Size, and Return on Assets have the significant effect on the capital structure at firms of miscellaneous industry sector listed on the Indonesia Stock Exchange (IDX) for the 2010-2014 period simultaneously. Partial test results indicate that only Ratio Tangible Assets and Return on Assets variables significantly influence the capital structure for the period 2010-2014. The moderating test demonstrates that profitability does not prove to be a moderating variable which means the variable is unable to strengthen or weaken and moderate BI rate, Ratio Tangible Assets, and Firms Size relationships with capital structure in in firms of miscellaneous industry sector listed on the Indonesia Stock Exchange (IDX) for the 2010-2014 period.
