Russian Journal of Agricultural and Socio-Economic Sciences (Mar 2024)
THE EFFECT OF LEVERAGE, PROFITABILITY, LIQUIDITY, AND SALES TO TOTAL ASSET ON FINANCIAL DISTRESS OF NON-CYCLICALS COMPANIES LISTED ON THE INDONESIA STOCK EXCHANGE FOR THE PERIOD OF 2020-2022
Abstract
Financial distress is a condition where a company experiences financial difficulties due to various errors that occur in the company. The Covid-19 pandemic has caused companies to experience financial difficulties. Non-cyclical consumer companies which in theory are not affected by macroeconomic conditions were also affected during the Covid-19 pandemic. This research aims to determine the effect of leverage, profitability, liquidity and sales on total assets in financial distress conditions. This research uses a purposive sampling technique, namely selecting samples using certain criteria. Secondary data sources are taken from the financial reports of non-cyclical consumer companies listed on the IDX for the period 2020-2022. The amount of data that will be processed in this research consists of 46 observation data. The data analysis technique used was a logistic regression model with the SPSS program. The results of the research show that there is no influence from Leverage on the possibility of financial distress. Profitability has a negative and significant effect on the possibility of financial distress. Liquidity does not affect financial distress conditions. Sales to total assets do not affect financial distress conditions. It is hoped that the research results can be used by the management of non-cyclical consumer companies as material for developing strategies in dealing with financial distress conditions. The recommended strategy is to increase the company's profitability.
