The Effect Of Working Capital Turnover On Profitabiltity (Empirical Study Of Food And Beverage Companies On The Indonesia Stock Exchange In 2015-2018)

I Made Mahardika Diputra¹, Sutarmin², Sugiyanto³

Abstract

To achieve this goal, the company must make a plan to increase its production output. In this case, working capital is current assets minus current liabilities or funds that must be available to finance the company’s daily operations, such as paying employee salaries, purchasing raw materials, paying debts, and so on. The allocated funds are expected to be returned in a short time, perhaps within one year or less. Therefore, the source of funds will continue to rotate as long as the company survives. The availability of sufficient working capital is important to finance business operations. Therefore, the company must be able to use its working capital effectively and efficiently. Excessive working capital will also cause losses for the company because the opportunity to make a profit is wasted. For this reason, every business is required to manage its working capital efficiently and effectively. The sample that will be taken in this study is the total population of annual financial reports at Food and Beverage Companies on the Indonesia Stock Exchange The analysis technique uses Multiple Linear Regression, Cash turnover has a positive and significant effect on profitability, which means that if the cash turnover variable increases, the profitability variable will also increase. Accounts receivable turnover has a positive and significant effect on profitability, which means that if the accounts receivable turnover variable increases, the profitability variable will also increase.Inventory turnover has a positive and significant effect on profitability, so that the profitability variable will increase if the inventory turnover variable increasesl.