Assessing the Condition of Financial Distress With Analysis of Liquidity, Solvency and Profit of Companies in Indonesia
Categorie(s):
Liquidity, Solvency, Profitability, Financial Distress
Author(s):
I Gede Putu Eka Budiyasa, I Wayan Widnyana
Tahun:
2022
Kode:
EJR-0219
Item Type:
Journal
Additional Info:
Article was published on American Journal of Humanities and Social Sciences Research (AJHSSR)
Volume-6, Issue-1, pp-279-284
www.ajhssr.com
eISSN/eISBN:
2378-703X
Keyword(s):
Liquidity, Solvency, Profitability, Financial Distress
Abstract :
Financial distress is the stage of declining financial conditions that occurred before bankruptcy. To determine the risk of bankruptcy by knowing the signs of financial distress. Financial distress can analyze financial statements using financial ratios, namely liquidity, solvency and profitability. The purpose of this study was to examine the effect of liquidity, solvency and profitability on financial distress conditions. The population in this study were 30 consumer goods industrial companies. By using purposive sampling technique, 21 companies were obtained. Using 3 (three) years, 63 observations were obtained. Data analysis technique is logistic regression analysis with SPSS V.23 program. The results of this study indicate that liquidity and profitability have a negative and significant effect on financial distress conditions so that the hypothesis is accepted, but solvency has a positive and significant effect on financial distress conditions, this means rejecting the hypothesis.