The Relationship Between Debt and Cash Turnover Towards Company Profitability in The Digital Era

Wati Aris Astuti () and Misael Stephen ()
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Wati Aris Astuti: Universitas Komputer Indonesia, Lecturer in Accounting Faculty Economy and Business
Misael Stephen: Universitas Komputer Indonesia, Student of Accounting Study Program

A chapter in Proceedings of the 8th International Conference on Business, Economics, Social Sciences, and Humanities - Economics, Business and Management Track (ICOBEST-EBM 2025), 2025, pp 4-12 from Springer

Abstract: Abstract This study aims to comprehensively analyze the influence of debt management and cash turnover on the profitability of public infrastructure sector companies listed on the Indonesia Stock Exchange (IDX) during the period from 2019 to 2023. The research methodology includes descriptive analysis to provide an overview of the financial condition of the companies, as well as verification analysis to examine the causal relationship between the studied variables using a quantitative approach. The research population consists of financial statements, particularly income statements and statements of financial position, from infrastructure companies listed on the IDX during the specified period. A purposive sampling technique was employed to select samples based on specific criteria, such as the completeness of financial data and consistency in reporting over the five-year period. Based on these criteria, a total of 50 financial reports were selected as research samples. The findings reveal that debt has a significant positive effect on profitability, indicating that well-managed debt utilization can enhance a company’s profitability. Additionally, cash turnover also shows a significant positive effect on profitability, highlighting the importance of efficient cash flow management in supporting a company’s financial performance. In conclusion, both debt management and cash turnover play a critical role in improving the profitability of public infrastructure sector companies on the IDX, suggesting that companies should focus on optimizing these financial aspects to achieve better financial outcomes.

Keywords: Debt; Cash turnover; Profitability (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-795-3_2

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DOI: 10.2991/978-94-6463-795-3_2

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