Abstract
The objective of this research is to get an understanding on the effect of the investment decision, capital structure and dividend policy on financial performance using the Multiple Regression Analysis. It is expected that this model will give more comprehensive analysis on the effect of the investment decision, capital structure and dividend policy on financial performance of public companies, which includes the direct or indirect effect on one variable against the others variables. on public companies in Indonesian Stock Exchange in 2014-2017. The findings reveal that, the investment decision has a more dominant effect on financial performance. The investment decision, capital structure and dividend policy have a positive effect on financial performance. The theoretical finding on this research can be developed to make investment decisions, capital structures and dividend policies of public companies. In other words, the three variables will have some means of effect on financial performance, compare with other factors.
Highlights
The company is one form of corporation that runs every type of business, is permanent, continuous and works within the territory of the Republic of Indonesia, for the purpose of obtaining profits and or profits (Article 1 letter b of Law number 3 of 1982 concerning Obligatory to Register of Companies)
The results found that investment decisions, dividend policy, and capital structure significantly influence financial performance both simultaneously and partially (Tables 4 and 5)
Investment decision, capital structure, and dividend policy impact on financial performance amounted by 43% and 57% determined by other variables (Table 6)
Summary
The company is one form of corporation that runs every type of business, is permanent, continuous and works within the territory of the Republic of Indonesia, for the purpose of obtaining profits and or profits (Article 1 letter b of Law number 3 of 1982 concerning Obligatory to Register of Companies). According to Brigham and Houston, an increase in debt is interpreted by outsiders about the company's ability to pay obligations in the future or the presence of low business risk, this will be positively responded by the market. In much of his formal analysis, the economic theorist at least has tended to side-step the essence of this cost-of-capital problem by proceeding as though physical assets-like bonds-could be regarded as yielding known, sure streams. The first view is known as the traditional view which states that the capital structure affects the value of the company Another policy regarding company value is investment decisions, where investment decisions in this case are short-term and long-term investments. One factor that influences financial performance is capital structure. (Hidayat, Wahyudi, Muharam, Shaferi, & Puspitasari, 2019) The capital structure of an enterprise consists of long-term debt and shareholder's equity, where stockholder equity
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
