Future Profitability Research Articles

Analysis of Production Cost Calculation Using Job Order Costing Method at PT Secma Energy Cell

Production Cost Calculation is very important for companies as support in financial reporting. Recording production costs encourages business managers to create accurate and fast administrative documentation, so that companies can predict selling price and profit and loss in accordance with expectations. This study aims to examine whether PT Secma Energy Cell, situated in Gresik Regency, East Java, to the principles of cost accounting in implementing the Job Order Costing method for determining production costs. Utilizing a descriptive qualitative approach with a case study methodology, the study aims to evaluate the application of cost calculations for plastic bags and rolls of varying sizes. Data gathering techniques encompass observation, interviews, and documentation of total and variable cost calculations. The study spanned around six months, from December 2022 to May 2023, whereas the data recorded dates back to October 2021. Findings revealed that PT Secma Energy Cell employs a total of 62 individuals, with 34 engaged directly in production activities, while the remainder are non-production staff. Over the course of one month, the company utilized 115,400 kilograms of raw materials, amounting to IDR 2,311,471,500.00, the production of ready-to-sell goods for 1 month was 42,775,005 kg, plastic roll production was 105,020.00 kg, and plastic bag production was 147,795 kg. Up to this point, the company has established the product price per kilogram with an approximately markup of 70%, so that each order received has been calculated in advance regarding the selling price of each product. The analysis revealed that using the Job Order Costing method, the production cost amounted to IDR16,559.48 per kilogram for plastic bags and IDR20,118.81 for plastic rolls. This indicates that PT Secma Energy Cell effectively implements the job order costing method by accurately accounting for expenses associated with raw materials, direct labor, and factory overhead costs. This is intended to enhance the accuracy of the set selling price and potentially boost the company’s future profitability.

Environmental legal institutions and management earnings forecasts: Evidence from the establishment of environmental courts in China

This paper investigates whether and how managers of highly polluting firms adjust their earnings forecast behaviors in response to the introduction of environmental legal institutions. Using the establishment of environmental courts in China as a quasi-natural experiment, our triple difference-in-differences (DID) estimation shows that environmental courts significantly increase the likelihood of management earnings forecasts for highly polluting firms, compared to non-highly polluting firms. This association becomes more pronounced for firms with stronger monitoring power, higher environmental litigation risk, and greater earnings uncertainty. Additionally, we show that highly polluting firms improve the precision and accuracy of their management earnings forecasts following the establishment of environmental courts. Furthermore, we provide evidence that our results do not support the opportunistic perspective that suggests managers strategically issue more positive earnings forecasts to inflate stakeholders' expectations subsequent to the implementation of environmental courts. Overall, our research indicates that environmental legal institutions make firms with greater environmental concerns to provide more forward-looking information, thereby alleviating stakeholders’ apprehensions regarding future profitability prospects.

An Effective Solution for Investing Funds Through the Robo Advisor Bibit Application

Investment regulates finance such that its value can grow and generate future profits. In Indonesia, investment is increasing yearly. The increase is supported by millennials who have adapted to technology that makes it easier to make digital mutual investments. Although the increase in mutual investment in Indonesia is quite rapid, it does not preclude the possibility that there are still many people who have not invested. The reason people have not invested is that they are afraid to take risks, and their income is low. These reasons can be minimized with the use of technology. Innovation in investing has given rise to modern technological advances such as fintech or financial technology like Robo Advisor. The method used in this study was the Partial Least Squares Structural Equation Modelling analysis technique, which was operated using SmartPLSver. 3 software. Data were collected through questionnaires. The study used quantitative methods and a sample of 200 respondents who had or would have invested through the Bibit application with the use of the Robo Advisor feature. The results of this study found that Robo Advisor can affect millennials’ investing through risk profiling, financial planning, and rebalancing. Keywords: decision making, financial planning, investment, risk profiling, rebalancing, Robo Advisor

Behavioural finance and dividend changes as predictors of future profitability: A literature review

This paper's primary goal is to present a significant element of the current dividend policy challenges from the perspective of behavioral finance. Given that dividend policy is one of the more contentious subjects in corporate finance, and because of this, scholars in the field have recently attempted to address the dividend policy conundrum by utilizing behavioral finance viewpoints. From the standpoint of behavioral finance, the study provides a general overview of the literature on dividend policy. This work offers a review of the literature. Together with behavioral components, it summarizes the main theoretical justifications for the dividend policy from the standpoint of behavioral finance.

Risk Measurement of Investment Portfolio Using Var and Cvar from The Top 10 Traded Stocks on the IDX

Portfolio investment reflects a commitment to the allocation of funds or resources which is considered a strategic step in managing assets to achieve future profits. This research begins with a careful analysis of a portfolio consisting of the ten best stocks on the Indonesia Stock Exchange (IDX). Through in-depth processing and analysis of stock data, the dynamics of performance, risk and volatility involved in each investment commitment are revealed. The Value-at-Risk (VaR) and Conditional Value-at-Risk (CVaR) methods at the 90%, 95%, and 99% confidence levels take centre stage, highlighting the potential for increased losses as confidence levels increase. In-depth analysis illustrates that CVaR, considering the extreme risks in the distribution, provides a more holistic picture than VaR. With a VaR (99%) value of IDR 84,973,959,424 and CVaR (99%) of IDR 471,795,822,064, this research provides a concrete picture of potential risks at the highest level of confidence. These results confirm that CVaR has a crucial role in identifying and measuring the potential for more significant losses, especially in the face of unexpected market uncertainty. As a guide for investment decision makers, this research forms an important basis for carefully considering the level of risk and potential return at various levels of confidence. This allows the development of smarter and more informed investment strategies.

Optimal Portfolio Using Single Index Model (SIM) For Health Sector Stocks

Investment is one of the fund management activities with the aim of obtaining future profits. In addition to profits, investors also need to consider the risks that will be faced by diversifying. Diversification is done by forming an optimal portfolio. This research aims to determine the proportion of stocks in the optimal portfolio and calculate the expected return and risk value of the optimal portfolio. The object used to form the optimal portfolio is health sector stock group for the period January 2020 - December 2022. The method used to form the optimal portfolio is Single Index Model (SIM). The results showed that there were 6 combinations of health sector stock in the optimal portfolio, such as IRRA, PRDA, SAME, SILO, MERK, and HEAL stocks of 8.94%, 9.24%, 9.34%, 11.92%, 27.15%, and 33.41% respectively with expected return of 2.68% and a risk value of 1.85%.

An Empirical Review of Capital Structure Decision-Making

The capital structure reflects the proportional relationship between a company's debt and equity, indicating the company's ability to repay debt and refinance. The quality of the capital structure determines the company's future profitability and development trend, serving as an indispensable indicator of the company's financial situation. However, with approximately 70 million companies in the global market, their scales and operating conditions vary in stability and growth. Additionally, their financial and asset structures differ significantly and are subject to macroeconomic fluctuations every year. The risk preferences and attitudes of managers and investors in every enterprise are subjective and affect the development plan of the enterprise. Moreover, tax and fiscal policies in different countries and regions also influence the capital strategies of enterprises. Furthermore, after a successful listing, the capital structure of the enterprise undergoes fundamental changes, diversifying the sources of funds and experiencing new changes in operating models, which is beneficial to the future operational planning and financial strength of funds. Nevertheless, not all companies that go public are beneficial to their development, such as Huawei, Heinz Group, Koch Industrial Group, etc., due to changes in capital structure after going public being detrimental to future corporate profits. Hence, the capital structure of enterprises in different countries, regions, or types of scale needs to be tailored to local conditions. Enterprises should analyze specific situations to establish a more reasonable capital structure with the aim of optimizing company operations.

The Economic and Environmental Aspects of Miscanthus × giganteus Phytomanagement Applied to Non-Agricultural Land

Miscanthus × giganteus (M × g) is a promising energy crop in phytotechnology with biomass production. Despite considerable vegetation and harvest under varying climate conditions and across different soils, field-scale studies on utilising M × g remain scarce. Analysing the literature and our own findings, this study intends to highlight the potential of M × g phytotechnology for revitalising non-agricultural lands (NAL), including brownfields, and illustrate the expediency of applying biochar to enhance biomass yield, energy efficiency, and economic feasibility. To validate the feasibility of M × g production on brownfields, two scenarios within the value chain “biomass–biogas–electricity” for green harvest were examined. The assumptions were as follows: (1) a methane yield of 5134 m3 ha−1 y−1, and (2) substrate-specific methane yields of 247 and 283 mL (g oDM)−1 for the first and subsequent years, respectively. The findings suggest that Scenario 2 is better suited for cultivating M × g on brownfields/NAL, being more sensitive and eliminating inaccuracies and the generalisations of results. From the third year onward, the revenue of M × g production on biochar-amended brownfields showed greater potential for future profitability. Future research should confirm the positive trend in the energy efficiency ratio of M × g phytotechnology on a larger scale, particularly in real brownfield applications.

Exploring Factors Affecting Store Operating Profit Using Multiple Regression

The aim of this paper is to increase the profit of the company more efficiently. With the continuous development of science and technology and big data at this stage, the degree of influence of Marketing Spend, Administration, Transport and Area factors on Profit is quantified through the use of multiple linear regression models. This article is a linear regression analysis using the operational data collected from Kaggle for a company's 50 shops in 3 regions. Through the analysis, the model has a good fit and significant linear relationship, which can predict the future profit of the enterprise. At the same time, the model can also guide the enterprise how to improve the operating profit more efficiently, which has a certain guiding effect on the development of business operations. Based on the results, it can be seen that Marketing Spend has the greatest impact on the enterprise's profit.

Dividend cuts and a firm's investment opportunity set

AbstractThis paper re‐examines corporate dividend payout policy by focusing on how investors evaluate dividend cuts. Our focus is to understand why despite the documented on average negative market response, many dividend‐cutting firms experience a positive market response. We juxtapose a well‐established literature on corporate payout policies with the literature on the role of prior information in investor evaluation of newly arrived information and document that the market responds positively to dividend cuts when firms have positive investment opportunity sets. Our results support the primary thesis that not all dividend cuts are bad news—it depends. We validate this result by documenting that firms cutting dividends in the presence of investment opportunities do make significant investments such as capital expenditures and merger and acquisition activities in future years. Furthermore, we also find that future operating profitability is higher for dividend‐cutting firms with relatively higher investment opportunities. We also document that among dividend‐cutting firms, there is a statistically significant difference in the buy‐and‐hold returns for up to 2 years, between firms with high versus low investment opportunities. This provides support for the economic significance of our results. These results provide new evidence on how investors interpret corporate payout policies to distinguish among dividend cuts.

Improving new energy subsidy efficiency considering learning effect: A case study on wind power

Subsidy policies are instrumental in driving the development of new energy. However, the effective allocation of new energy subsidies over time is challenging given fiscal constraints. This study addresses this challenge by considering the learning effect associated with the new energy industry. A two-stage dynamic programming model is proposed to capture the investment decision-making process of companies under new energy subsidy policies and government subsidy setups. Theoretical findings suggest that company investment decisions in new energy are influenced by a guiding principle: The subsidy rate should be negatively correlated with the variation rate of production scale increment (VRPSI). We calibrate this investment decision principle using wind power data from 14 countries. According to this principle, excessive subsidy rates may result in a low VRPSI, thereby diminishing future investment profitability in the new energy industry and leading to subsidy inefficiency. Upon investigating the efficiency of annual subsidy allocation, we find that the subsidy rates were potentially set too high in 2014, 2016, and 2017. Furthermore, the government should exercise caution regarding an inefficient subsidy pattern whereby companies invest in new energy only when the subsidy rate exceeds a certain threshold, neglecting traditional power sources. It is crucial to note that although this study uses wind power industry data for calibration and simulation, the theoretical model can be broadly applied to other new energy industries and emerging industries with increasing marginal net profit.

Navigating the Uncertain Waters: An Analysis of the Near Future Profitability of the Russian Ruble

This paper aims to provide a comprehensive analysis of the near future of the Russian ruble, with a particular focus on its potential profitability as an investment asset. Amidst a backdrop of political tensions, economic sanctions, and ineffective forex interventions by the Russian Central Bank, the ruble has experienced significant volatility. The paper examines key factors influencing the rubles value, including political climate, inflation, interest rates, and main exports. The study analyzes the causes and solutions of Russias three major devaluations since the dissolution of the Soviet Union in 1992. By analyzing historical exchange rate and other economic indicators, the paper scrutinizes the internal and external indicators of rubles devaluation and evaluates the various policy measures taken by the Central Banks of Russia to stabilize the currency, including redenomination and shifts in exchange rate mechanisms. The paper concludes that, given the current political and economic landscape, the profitability of investing in the Russian ruble is questionable and unrecommended. Through this multi-faceted approach, this paper aims to provide a nuanced understanding of Rubles past and present, thereby offering valuable insights for policymakers, investors, and scholars interested in the foreign exchange market of Ruble.

Environmental regulations, agency costs, and firm performance

We investigate whether environmental regulation reduce agency costs. We find that increases in environmental restrictions decrease liquidity and increase financial constraints. In addition, it increases the likelihood of the firms being acquired or delisted from the exchanges. Such adverse outcomes should lead the shareholders into taking actions that mitigate these risks. We notice that shareholders restructure the board of directors and incentivize CEOs with more stock ownership. These actions, in turn, reduce agency costs and lead to increases in future profitability for these firms.

Halal Information in Customer Value Disclosure

Indonesia has a majority Muslim population, so consumers have the right to know the halalness of the products/services they consume. In addition, halal information can be of value to customers because it is a differentiator from similar products/services offered by other producers. This study aims to propose halal information as a novelty in Customer Value Disclosure (CVD). This novelty is important to reduce information asymmetry, provide value added and competitive advantage for companies, especially when operating in areas with a majority Muslim population. In addition, this novelty can be studied in further studies associated with other variables such as stock price, firm value, future profitability, cost of equity, personnel readiness and others. Through a literature review with reference to two studies that specifically discuss Customer Value Disclosure (CVD) and the annual reports of several companies, it is concluded that halal information can be added to the disclosure because the company has provided this information in the annual report. The information is in the form of the company's commitment and achievements towards halal products/services and halal certification obtained.

INFLUENCING FACTORS INVESTMENT DECISION IN GENERATION Z (CASE STUDY ON FEB BANDAR LAMPUNG UNIVERSITY STUDENTS)

Finance has now become one of the most important livelihood goals for everyone, and to meet daily needs, everyone needs money. Investing is one way to allocate capital for future profits. Investment decisions are influenced by various factors. The aim of this research is to find out and analyze the factors that influence investment decisions in Gen-Z. The population in this study were active undergraduate students at the Faculty of Economics and Business, Bandar Lampung University. Sampling used a purposive sampling method with the criteria of having made an investment, with a sample size of 100 people. This study uses Multiple Linear Regression analysis and uses the SPSS 26 application to process the data. The results obtained are that rational and irrational attitudes have a positive and significant partial or simultaneous effect on investment decisions. These results show that undergraduate students at the Faculty of Economics and Business, Bandar Lampung University, as Gen-Z, already have a good understanding of financial literacy, and have self-confidence based on their skills and knowledge, so they are confident that their investments will meet expectations.

A strategic approach to the development of automotive dealerships in a changing market environment

The activities of automotive dealerships need to be strategically adapted to changing market conditions. The article examines the role played by the automotive industry in the Russian economy, presents an analysis of changes in the structure of new car sales in the period from 2021 to 2023.The strategic factors that dealerships should consider when choosing a brand are described. The necessity of analyzing the competitive environment is justified, the existing marketing tactics of manufacturers are presented, the importance of the availability of spare parts and opportunities for revenue growth from after sales-service are described. The article emphasizes the need to invest in the reconstruction of dealerships, despite the inevitable financial losses, to ensure the future profitability of the business. The study provides information for players in the Russian automotive industry, helping them to change their strategy for the future development of the company in a changing market environment.

On the informativeness of unexpected exclusions from street earnings

AbstractExclusions from street earnings can include both expected exclusions, forecasted ex ante by analysts, and unexpected exclusions, revealed after earnings are reported. While prior research largely examines total exclusions from street earnings, unexpected exclusions reflect the news or surprise in exclusions. We investigate the properties and informativeness of unexpected exclusions for future profitability, benchmark beating, analyst forecast errors, and future stock returns. We find that unexpected exclusions represent a mix of transitory and recurring items and are informative about future street earnings. In an analysis of hand‐collected analysts' reports, we find that unexpected exclusions are more likely to reflect misestimated recurring items when analysts forecasted exclusions, and unexpected transitory items when analysts did not forecast exclusions. We also examine benchmark‐beating behavior, in which street earnings meet street forecasts but GAAP earnings miss GAAP forecasts. We observe that benchmark beating is more likely to occur when analysts forecast exclusions than when they do not. Moreover, we find unexpected exclusions are more persistent when street earnings meet street forecasts but GAAP earnings miss GAAP forecasts. These findings are consistent with recurring earnings amounts being opportunistically shifted to excluded items to meet analysts' street forecasts. Finally, we find some evidence that analysts and investors react to, but do not fully incorporate, the information in unexpected exclusions, based on forecast revisions and stock price reactions.

Pengaruh Rasio Keuangan Terhadap Pertumbuhan Laba Pada Perusahaan Manufaktur yang Terdaftar di Bursa Efek Indonesia

The purpose of this research is to collect data that demonstrates how various financial ratios affect the development of a company's bottom line. Multiple ratios are used in the analysis, such as the Current Ratio (CR), Debt to Equity Ratio (DER), Total Asset Turnover (TAT), and Net Profit Margin (NPM). This research covers the time period from 2017 to 2021 and is limited to manufacturing companies that are listed on the Indonesia Stock Exchange. Eight of these organizations make up the sample size for this study. The f-test and t-test are used to examine the hypotheses, and the multiple linear regression analysis model is used for data analysis in this study. This investigation suggests that neither the Current Ratio (CR), nor the Debt to Equity Ratio (DER), nor the Total Asset Turnover (TAT) significantly affects the development of profits. However, the Net Profit Margin (NPM) is found to be a highly important predictor of future profits. Current Ratio (CR), Debt to Equity Ratio (DER), Total Asset Turnover (TAT), and Net Profit Margin (NPM) were used as independent variables in this investigation.

The nexus between bank efficiency and leverage

AbstractIn this paper, we shed light on the impact of leverage on efficiency by introducing a new banking efficiency indicator that includes efficiency and stability conditions. This indicator relies on the leverage as a proxy of a bank's risk and stability. Banks' leverage played an important role in the last financial crash as well as in the Basel III regulatory rules. The results of the econometric investigation using a large sample of American commercial banks show that profit efficiency indicators including leverage are better predictors of future profits than current indicators, including other measures of bank risk. This is particularly evident for the period during the 2007–2009 financial crisis. Our findings have important policy implications, particularly in light of the recently implemented optimal leverage ratio.

THE EFFECT OF USAGE AIS ON SMALL BUSINESS PERFORMANCE IN MUGADISHO-SOMALIA

The purpose of this study is to investigate how the Accounting Information System (AIS) affected the performance of small businesses. The study's particular goals were to determine how top management support, usefulness, and ease of use were impacted by AIS, a tool used to analyze small business performance in Mogadishu, Somalia.
 Theoretical Framework: "Meta-theory" describes how the technical, organizational, and cognitive approaches are combined and integrated to provide an all-encompassing model for AIS research. 
 Design, Methodology, and Approach: The population of the study comprised small businesses in the Bakaro market that focus on retail, electronics, and clothes. The main data for this investigation were gathered manually using a questionnaire. Non-probability sampling was employed, and the data were subjected to regression and correlation analyses using SPSS software. The investigation's methodology was survey design.
 Findings: The results of this study demonstrate a direct relationship between accounting information systems and business performance, suggesting that access to trustworthy accounting data improves organizational effectiveness. Hence, the accounting information system may have an impact on how Somalia's businesses operate economically.
 Research practical and social implication: The ease of use, usefulness, and support management of the accounting information system are enormous benefits for the economy, businesses, and organizations. A constant supply of precise and trustworthy data is necessary for the economy to grow. The biggest factor increasing the entire worth of a firm is performance management. 
 The paper recommends that firms integrate accounting information systems into their daily operations to increase future sales and profitability and Given that accounting information systems (AIS) facilitate the development of analytical comparisons, also governments should establish comprehensive, universal training facilities for small businesses.
 Originality/Value: This approach identifies a strong correlation between organization science, technology, and cognitive functions. A variety of AIS technologies, such as databases, expert systems, and decision support tools, can be utilized to address accounting-related issues. As such, the cognitive and organizational demands of the activity must be considered while selecting and applying these tools. A variety of AIS solutions are necessary because AIS users encounter several problems and organizational limitations.