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Determinants of debt policy: An empirical studying Indonesia | 17112
International Research Journals

Educational Research

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Determinants of debt policy: An empirical studying Indonesia stock exchange

Abstract

Bambang Sudiyatno and Septavia Mustika Sari

The purpose of this study was to analyze the factors that influence the debt policy (leverage) at the manufacturing companies listed on the Indonesia Stock Exchange (IDX). Factors affecting the leverage in this study were non-debt tax shield, asset structure (tangibility), profitability, growth, and firm size. The sample in this study is a manufacturing company listed on the Stock Exchange the period 2007 to 2009. Sampling study using purposive sampling method was used. Sources of research data obtained from the publication of the financial statements of the company by IDX Indonesian Capital Market Directory (ICMD) in 2010, with a total sample of 114 manufacturing companies. The analysis technique used is multiple regression analysis. The results showed that tangibility, growth and firm size have a positive and significant impact on leverage. Profitability significantly and negatively related to leverage, while the non-debt tax shield and no significant negative effect on leverage.

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