PENGARUH PROFITABILITAS, LIKUIDITAS, LEVERAGE DAN AKTIVITAS TERHADAP FINANCIAL DISTRESS

Abstract

Financial distress is the deterioration of a company's financial situation that occurred before bankruptcy. The appearance of financial difficulties begins when a company is unable to meet its obligations, including short-term liabilities and debts under the solvency category. This research aimed to gain empirical evidence about the effect of profitability, liquidity, leverage, and activity on financial distress (a case study at Food and beverage companies listed on the Indonesia Stock Exchange 2017-2020). Moreover, the data collection technique used purposive sampling. In line with that, there were 12 companies as the sample. In total, there were 48 observation data. The data analysis technique used multiple linear regression. Furthermore, the result concluded that profitability had a negative effect on financial distress, with a t-value of -5.947 and a significance of 0.000. Liquidity had a negative effect on financial distress, with a t-value of-1.147 with a significance of 0.258. Leverage had a positive effect on financial distress, with a t-value of 2.288 and a significance of 0.027. Activity had a negative effect on financial distress, with a t-value of-3.104 and a significance of 0.003.