Open AccessThe Effect of Asset Structure and Agency Costs on Debt Policy with Profitability as an Intervening Variable
Author(s) -
- Hermanto,
Dravinca Rona Liem
Publication year - 2022
Publication title -
influence
Language(s) - English
Resource type - Journals
ISSN - 2808-1471
DOI - 10.54783/influence.v4i1.208
Subject(s) - profitability index , leverage (statistics) , business , agency cost , debt , asset (computer security) , stock exchange , capital structure , nonprobability sampling , asset turnover , finance , monetary economics , economics , return on assets , corporate governance , computer science , statistics , shareholder , mathematics , population , demography , computer security , sociology
The data for this study were gathered from the annual financial statements of food and beverage companies listed on the New York Stock Exchange using a purposive sampling technique that fits the research criteria. The research was conducted over a five-year period, with as many as 70 data points collected from 14 food and beverage sub-sector businesses. This study employs a variety of linear analytic techniques in conjunction with secondary data types. The study's findings indicate that asset structure and agency costs have a concurrent effect on profitability, and that asset structure, agency costs, and profitability all have a concurrent effect on leverage. Asset structure has a detrimental effect on profitability but a beneficial effect on leverage. Agency costs have a negative effect on profitability but a good effect on leverage. Leverage is adversely affected by profitability. The research demonstrates that organizations that focus on asset structure and agency expenses can overcome debt policies and boost profitability.