The Effect of Inventory Turnover, Working Capital Turnover, Current Ratio, and Asset Tangibility on Profitability in the Industrial Sector
DOI:
https://doi.org/10.24905/icobis.v2i1.70Keywords:
Inventory Turnover, Working Capital Turnover, Current Ratio, Asset Tangibility, ProfitabilityAbstract
This study analyzes the effects of inventory turnover, working capital turnover, current ratio, and asset tangibility on the profitability of industrial sector companies listed on the Indonesia Stock Exchange (IDX) for 2020–2024. A quantitative associative approach was applied using secondary data from the companies’ financial statements. From a population of 65 companies, purposive sampling yielded 36 companies and 180 firm-year observations. Data were analyzed using multiple linear regression in SPSS 22, with classical assumption tests, t-tests, an F-test, and the coefficient of determination. The results show that, individually, inventory turnover, working capital turnover, and asset tangibility have no significant effect on profitability, whereas the current ratio has a positive and significant effect. Simultaneously, the four variables significantly affect profitability. The adjusted R² of 10.7% indicates that the four variables explain 10.7% of the variation in profitability, while 89.3% is explained by factors outside the model.
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