Contribution of Capital Structure, Liquidity and Firm Size to Financial Performance

Abstract

This research aims to determine the effect of capital structure (DAR), liquidity (CR) and firm size (LnTA) on financial performance (ROA) in the pharmaceutical industry listed on the Indonesia Stock Exchange for the 2016 - 2021 period.The sampling method used in this research is the purposive sampling method. Based on predetermined sampling criteria, 7 companies in the pharmaceutical industry listed on the Indonesia Stock Exchange for the period 2016 - 2021 were obtained. This research used multiple linear regression analysis techniques for panel data, namely the E-views 10 analysis tool Based on the results of data analysis, it is concluded that capital structure (DAR) has a negative and significant effect on financial performance (ROA), with a probability value of 0.475. Liquidity (CR) has a positive and significant effect on financial performance (ROA), with a probability value of 0.225. Firm size (LnTA) has a positive and significant effect on financial performance (ROA), with a probability value of 0.0001.