Determinants of profitability in concept of going concern
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Oct 6, 2023
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Abstract
Study aims to identify and analyze liquidity and financial leverage as determinants of profitability. Going concern is accounting assumption that expects business to continue indefinitely. This concept implies the company's responsibility to maintain stability and continuity comprehensively through its ability to earn profit from its operating activities. Real Estate and Property Companies listed in the KOMPAS 100 Index for period 2018 to 2022 as population, using purposive sampling technique, six companies were selected as samples. At significance level of 0.05, results of multiple linear regression analysis prove that liquidity has positive and significant effect on profitability, while financial leverage is not proven. These results imply that liquidity is determinant of profitability. Liquid companies will be seen as having high credibility and tend to cause positive reactions from investors, so that the company has sufficient capital to carry out its operational activities in effort to improve profitability to realize going concern concept
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How to Cite
Puspitaningtyas, Z. (2023). Determinants of profitability in concept of going concern. Enrichment : Journal of Management, 13(4), 2363-2369. https://doi.org/10.35335/enrichment.v13i4.1599
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Thinh, T. Q., Tuan, D. A., & Danh, L. C. (2022). The Impact of Control Activities on the Information Efficiency of Financial Reports: Evidence on Forbes Enterprises in Vietnam. Investment Management and Financial Innovations, 19(1), 313–321. https://doi.org/10.21511/imfi.19(1).2022.24
Widiyanti, M., & Elfina, D. F. (2015). Pengaruh Financial Leverage Terhadap Profitabilitas Pada Perusahaan Sub Sektor Otomotif Dan Komponen Yang Terdaftar Di Bursa Efek Indonesia. Manajemen Dan Bisnis Sriwijaya, 13(1), 117–136.
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Zaitoun, M., & Alqudah, H. (2021). The Impact of Liquidity and Leverage on Profitability in Industrial Sector in Jordan. Research in World Economy, 12(1), 394. https://doi.org/10.5430/rwe.v12n1p394
Ayoush, M. D., Toumeh, A. A., & Shabaneh, K. I. (2021). Liquidity, leverage, and solvency: what affects profitability of industrial enterprises the most? Investment Management and Financial Innovations, 18(3), 249–259. https://doi.org/10.21511/imfi.18(3).2021.22
Banerjee, S., Mitra, A., & Mohanti, D. (2023). Leverage and corporate investment – a cross country analysis. https://doi.org/10.21511/imfi.20(3).2023.11
Bhati, S., De Zoysa, A., & Jitaree, W. (2019). Factors affecting the liquidity of commercial banks in India: A longitudinal analysis. Banks and Bank Systems, 14(4), 78–88. https://doi.org/10.21511/bbs.14(4).2019.08
Darmayanti, P. D., Agus, G. P., & Susila, J. (2022). Pengaruh Likuiditas, Aktivitas, Dan Solvabilitas Terhadap Profitabilitas Pada Perusahaan Sub Sektor Tektil Dan Garmen Yang Terdaftar Di Bursa Efek Indonesia. Jurnal Manajemen Dan Bisnis, 4(2), 178–182.
Deniswara, K., Uyuun, R. M. F., Lindawati, A. S. L., & Willnaldo, W. (2019). Intellectual Capital Effect, Financial Performance, and Firm Value: An Empirical Evidence from Real Estate Firm, in Indonesia. The Winners, 20(1), 49. https://doi.org/10.21512/tw.v20i1.5500
Fitriana, R., Priatna, H., & Barokah, A. (2022). Pengaruh Likuiditas dan Solvabilitas Terhadap Profitabilitas Pada PT. Perkebunan Nusantara VIII. AKURAT| Jurnal Ilmiah Akuntansi FE UNIBBA, 13(02), 1–11. https://unibba.ac.id/ejournal/index.php/akurat/article/view/907
Horvathova, J., & Mokrisova, M. (2023). Integrated performance measurement system for Slovak heating industry : A balanced scorecard approach. https://doi.org/10.21511/ppm.21(3).2023.32
Huang, C. C. (2021). Assessing the financial performance of airlines in the Asia-Pacific region. Investment Management and Financial Innovations, 18(2), 234–244. https://doi.org/10.21511/imfi.18(2).2021.19
Husniar, H. (2022). Pengaruh solvabilitas dan likuiditas terhadap profitabilitas pada perusahaan perbankan yang terdaftar di Bursa Efek Indonesia (BEI). Fair Value: Jurnal Ilmiah Akuntansi Dan Keuangan, 5(1), 509–522. https://doi.org/10.32670/fairvalue.v5i1.2353
Kamsari, A., & Setijaningsih, H. T. (2020). Pengaruh Likuiditas, Efisiensi Modal Kerja, Leverage, Dan Ukuran Perusahaan Terhadap Profitabilitas. Jurnal Paradigma Akuntansi, 2(2), 603. https://doi.org/10.24912/jpa.v2i2.7625
Kusumawati, D. (2022). Pengaruh Likuiditas, Solvabilitas, Dan Modal Kerja Terhadap Profitabilitas. Value Added : Majalah Ekonomi Dan Bisnis, 18(1), 8. https://doi.org/10.26714/vameb.v18i1.9626
Lentner, C., László, V., & Petronella, M. (2020). Certain regulatory and efficiency issues of public utility companies in Budapest. Public and Municipal Finance, 9(1), 14–24. https://doi.org/10.21511/pmf.09(1).2020.02
Matemane, R., & Wentzel, R. (2019). Integrated reporting and financial performance of South African listed banks. Banks and Bank Systems, 14(2), 128–139. https://doi.org/10.21511/bbs.14(2).2019.11
Nurkhin, A., Widiatami, A. K., Nurkhin, A., Widiyanto, W., & Widiatami, A. K. (2023). analysis ” Do corporate governance implementation and bank characteristics improve the performance of Indonesian Islamic banking ? Before-COVID-19 pandemic analysis. https://doi.org/10.21511/bbs.18(3).2023.11
Parvin, S., Chowdhury, A. M. H., Siddiqua, A., & Ferdous, J. (2019). Effect of Liquidity and Bank Size on the Profitability of Commercial Banks in Bangladesh. Asian Business Review, 9(1), 7–10. https://doi.org/10.18034/abr.v9i1.219
Pasaribu, M., Rukiah, Fauzan, M., & Nasution, A. A. (2022). Pengaruh Financial Leverage terhadap Profitabilitas pada Perushaaan Sektor Industri Barang dan Konsumsi yang terdaftar Di Bursa Efek Indonesia. Jurnal Ekonomi Dan Perbankan Syariah, 7(1), 390–414.
Prijantoro, A. P. D., Karamoy, H., & ... (2022). Pengaruh Rasio Likuiditas Dan Solvabilitas Terhadap Profitabilitas Pada Perusahaan Manufaktur Sektor Industri Barang Konsumsi Yang Terdaftar Di BEI. … , Sosial, Budaya, Dan …, 5(2), 345–352. https://ejournal.unsrat.ac.id/index.php/lppmekososbudkum/article/view/37803%0Ahttps://ejournal.unsrat.ac.id/index.php/lppmekososbudkum/article/download/37803/34993
Rahmah, A. M., Cipta, W., & Yudiaatmaja, F. (2019). Pengaruh Likuiditas, Solvabilitas, Dan Aktivitas Terhadap Profitabilitas Pada Perusahaan Otomotif Yang Terdaftar Di Bursa Efek Indonesia Periode 2012-2014. E-Journal Bisma Universitas Pendidikan Ganesha, 4(1), 96–103.
Rajagukguk, J., & Siagian, H. (2021). The Effect of Liquidity and Total Asset Turnover on Profitability: Research Study n Pharmaceutical Companies in Indonesia Stock Exchange. Ekonomis: Journal of Economics and Business, 5(2), 444. https://doi.org/10.33087/ekonomis.v5i2.400
Ridha, N. A. N., & Kashmir, K. Y. (2017). Pengaruh Likuiditas Terhadap Profitabilitas Pada Perusahaan (Studi Pada Perusahaan Sektor Perbankan Yang Terdaftar Di Bursa Efek Indonesia Periode 2010-2014). Jurnal Ekonomi Dan Manajemen STIE Dharma Negara, 2(1), 39.
Ritonga, M., Kertahadi, R. S. M. (2013). PENGARUH FINANCIAL LEVERAGE TERHADAP PROFITABILITAS (Studi pada Perusahaan Sektor Makanan dan Minuman yang Terdaftar Di Bursa Efek Indonesia Periode 2009-2011). Jurnal Administrasi Bisnis, 1(2), 132–139. http://administrasibisnis.studentjournal.ub.ac.id/index.php/jab/article/view/49
Ruiz-Barbadillo, E., & Guiral, A. (2019). The value relevance of expected vs. unexpected going concern opinions. Investment Management and Financial Innovations, 16(2), 47–65. https://doi.org/10.21511/imfi.16(2).2019.05
Thinh, T. Q., Tuan, D. A., & Danh, L. C. (2022). The Impact of Control Activities on the Information Efficiency of Financial Reports: Evidence on Forbes Enterprises in Vietnam. Investment Management and Financial Innovations, 19(1), 313–321. https://doi.org/10.21511/imfi.19(1).2022.24
Widiyanti, M., & Elfina, D. F. (2015). Pengaruh Financial Leverage Terhadap Profitabilitas Pada Perusahaan Sub Sektor Otomotif Dan Komponen Yang Terdaftar Di Bursa Efek Indonesia. Manajemen Dan Bisnis Sriwijaya, 13(1), 117–136.
Winoto, A., & Bustaman, Y. (2020). Impact of Liquidity, Ownership, Global Financial Crisis, and Capital Adequacy Ratio on Indonesian Banking Profitability Period 2007-2016. The Winners, 21(1), 43. https://doi.org/10.21512/tw.v21i1.6012
Zaitoun, M., & Alqudah, H. (2021). The Impact of Liquidity and Leverage on Profitability in Industrial Sector in Jordan. Research in World Economy, 12(1), 394. https://doi.org/10.5430/rwe.v12n1p394