DETERMINANTS OF CAPITAL STRUCTURE: EVIDENCE FROM INDONESIAN PALM OIL COMPANIES

Cynthia Sari Dewi (), Brighton Jordy () and Harris Wijaya ()
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Cynthia Sari Dewi: Faculty of Business, Universitas Multimedia Nusantara, Tangerang, Indonesia
Brighton Jordy: Faculty of Business, Universitas Multimedia Nusantara, Tangerang, Indonesia
Harris Wijaya: Faculty of Business, Universitas Multimedia Nusantara, Tangerang, Indonesia

Business Excellence and Management, 2021, vol. 11, issue 4, 50-63

Abstract: This study to find out the determinants of capital structure in the palm oil industry in Indonesia. The variables are commodity prices, total assets, tangible assets, profitability, asset turnover, liquidity, inventory turnover, interest rates, and capital structure as independent variables. The data processing uses SPSS version 25 and performs classical assumption test, coefficient of determination test, and multiple regression analysis. The object of this study is oil palm plantation companies listed in Indonesian stock exchange (IDX) period 2016 to 2019. The results show that CPO prices, total assets, tangible assets, profitability, and interest rates have no effect on capital structure. Meanwhile, asset turnover has a positive effect on capital structure. Current ratio has a negative effect on the capital structure. Inventory turnover has a negative effect on the capital structure of oil palm plantation companies. This research is useful for companies engaged in the palm oil industry in determining policies.

Keywords: Capital Structure; Crude Palm Oil; Asset Turnover; Current Ratio; Inventory Turnover (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:rom:bemann:v:11:y:2021:i:4:p:50-63

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