The Effect of Sales Growth, Profitability, and Company Size on Leverage

Abstract

The research objective is to obtain empirical evidence of the positive effect of sales growth on leverage, the positive effect of profitability on leverage, and the positive effect of firm size on leverage. The decision to determine the capital structure (leverage) is a very important decision because this decision will affect the company's long-term going concern. The population used in this study was manufacturing companies that consistently listed on the Indonesia Stock Exchange from 2017 to 2019. Purposive sampling was used as a sampling technique. The data were processed using EVIEWS. The results showed that sales growth had no positive effect on leverage, profitability had a positive effect on leverage, and firm size had no positive effect on leverage.