Vol. 10, No. 1, June 2020, pp. 86-92
ISSN: 2720-9830. 86
Journal homepage: https://jurnal.darmaagung.ac.id/index.php/socio/about
The Effect Of Liquidity Ratio And Solvency On Profitability In Pt Agung Podomoro Land Tbk Period 2015-2019
Elisa Christin Hagai Tarigan Universitas Darma Agung
Article Info ABSTRACT
Article history:
Received April 2020 Revised May 2020 Accepted June 2020
The purpose of this study is to prove whether there is an effect of liquidity and solvency on profitability at PT Agung Podomoro Land Tbk. The data collection method used is the method of literature and field research, then the data is analyzed using the multiple linear regression analysis method with the help of SPSS software version 22. The results of the study state that liquidity is proxied by the current ratio and solvency is proxied by debt to assets ratio both in terms of partial or simultaneous have no effect on profitability as proxied by ROA. This is evidenced from the partial research test which shows that the current ratio has a value of tcount < ttable, namely -0.946 < 2.110 with a significant value of 0.357 > 0.05, and the debt to assets ratio has a value of tcount < ttable which is 1.140 < 2.110 with a significant level of 0.270 > 0.05, and the simultaneous research test also showed no effect, this was seen from the value of fcount < ftable, which was 1.101 < 3.55 with a significant value of 0.355 > 0.05. For the R square value of 0.115 or equal to 11.5%. This figure means that the liquidity variable (X1) and solvency variable (X2) affect profitability (Y) only by 11.5%, and it can be concluded that the influence of the independent variable (X) on the dependent variable (Y) is very weak and in explaining the dependent variable is also very limited.
Keywords:
Liquidity (CR) Solvency (DAR) Profitability (ROA)
This is an open access article under the CC BY-SA license.
Corresponding Author:
Elisa Christin Hagai Tarigan Universitas Darma Agung,
Email: elisachristinhagaitarigan@gmail.com
INTRODUCTION
The company is said to be healthy if the company is able to survive in difficult conditions, which can be seen from the company's ability to meet its business operational obligations in a stable manner and is able to maintain the continuity of its business development. In maintaining business continuity, companies need to make efforts on how to manage company finances well, where the company's performance is said to be good if the company can fulfill its financial obligations while being able to generate profits. The company's ability to earn profits can be seen from the level of profitability. Profitability is one of the important indicators to assess a company.
Profitability is not only used to measure the company's ability to generate profits but also to determine the effectiveness of the company in managing its resources. Profitability ratio is very important for all users, especially investors and creditors. In this study, to measure the level of profitability as a proxy for Return On Assets (ROA), the reason for using ROA as a performance measure is because ROA is used to measure the company's ability to earn profits or overall profit, the greater the company's ROA level, the greater the level of ROA. profits or profits obtained by the company and it shows the better the company's performance in managing or using assets. Sources of information regarding profitability can be seen from the financial statements issued by the company. By analyzing financial statements, it can be seen the level of performance that has been achieved by the company. One type of financial statement analysis that can be done by the company is ratio analysis. One of the things that need to be considered in assessing the level of company profitability is by looking at the level of liquidity and solvency of the company. If the company is faced with
costs that arise due to debt that is too large, it can cause the level of profitability to decrease. The liquidity ratio used in this study is the current ratio, and the solvency ratio used in this study is the Debt to Assets Ratio (DAR).
The level of liquidity, solvency and profitability of PT Agung Podomoro Land tbk can be seen from table 1.1 below.
Table 1. Liquidity Level (CR), Solvency (DAR), and Profitability (ROA) at PT Agung Podomoro Land tbk Period 2015-2019
year description
CR DAR ROA
2015 1,389 0,63 0,0454
2016 1,067 0,61 0,0365
2017 1,306 0,60 0,0653
2018 1,049 0,59 0,0069
2019 1,664 0,56 0,0041
Source: www.idx.co.id (data processed by the author, 2021)
From Table 1. above, it can be seen that the comparison between the liquidity ratio (CR), solvency (DAR), and profitability (ROA)
each has a fluctuating ratio from 2015 to 2019 at PT Agung Podomoro Land tbk. In 2015 the percentage of the liquidity ratio reached 1,389. In 2016, the company's liquidity ratio decreased to 1,067 from 2015, in 2017 the company's liquidity ratio reached 1,306 and increased by 23.9% from the previous year. In 2018 the liquidity ratio level reached 1,049, this year the company decreased by 25.7% from 2017, and in 2019 the liquidity ratio increased by 61.5% from the previous year so that in 2019 the company's liquidity ratio reached 1,664. The average solvency ratio at PT Agung Podomoro Land tbk from 2015 to 2019 was 0.63, 0.61.0.60, 0.59,
0.56 it can be seen that every year the company's solvency ratio has decreased although there is no significant decrease. In 2016 the solvency ratio decreased by 2% from 2015, in 2017 the solvency ratio also continued to decline with a decrease of 1% from the previous year, while in 2018 the solvency ratio decreased by 1% from the previous year, while in 2019 the rate of decrease in solvency reached 3% from the previous year.
Average profitability ratio at PT
Agung Podomoro Land tbk from 2015 to 2019 amounted to 0.0454, 0.0365, 0.0653,0.0069, 0.0041, it can be seen that in 2017 profitability increased by 2.88% from the previous year, and the last two years decreased. So the authors are interested in conducting research with the title: "The Effect of Liquidity Ratio, Solvency on Profitability at PT Agung Podomoro Land Tbk Period 2015-2019".
Scope of problem
Where in this study the limitation of the problem is using financial statements for 5 years. The influence of the Profitability Ratio (ROA) seen from the Liquidity Ratio (CR), and Solvency Ratio (DAR), The object of research conducted in this study is PT. Agung Podomoro Land Tbk. The period of this research is 2015-2019.
Formulation of the problem
Based on the background of the problem, the formulation of the problem in this study are: Does the Liquidity Ratio (CR) partially affect Profitability (ROA), Does the Solvency Ratio (DAR) partially affect Profitability (ROA), Does the Liquidity Ratio (CR) and Solvency (DAR) simultaneously affects Profitability (ROA)?
Research purposes
Based on the background and problem formulation that the researchers described above, the objectives of this study are as follows: To find out whether there is an effect of the liquidity ratio (CR) and solvency ratio (DAR) on profitability (ROA) and to find out how much the liquidity ratio and solvency.
Benefits of research
Theoretical Benefits This research is expected to add insight and knowledge about the company's financial ratios, especially in the company PT Agung Podomoro Land, Tbk.
Practical Benefits
For the company, PT Agung Podomoro Land, Tbk, as input for the company in maintaining the company's
Jurnal Ilmiah Socio Secretum, Vol. 10, No. 1, June 2020: 86-92
to increase knowledge and can be useful for academics, and can be a comparison or support in previous research. For the University as a consideration for the development of knowledge for academics as well as increasing knowledge related to the influence of liquidity ratios and solvency on company profitability. For the author, adding knowledge and insight in analyzing the company's financial statements, especially in terms of analyzing liquidity ratios, solvency on company profitability.
METHOD Research sites
This research was conducted at PT. Agung Podomoro Land Tbk, whose data is downloaded through the official website of the Indonesia Stock Exchange, namely www.idx.com and the website of PT Agung Podomoro Land, Tbk, namely www.agungpodomoroland.com.
This research starts in June 2021 until October 2021.
Population And Sample
The population in this study is the company's financial statements PT. Agung Podomoro Land Tbk from 2015- 2019. The sample used in this study were 20 financial reports (quarterly reports for 5 years).
Data Types and Sources
This type of research is quantitative research and the research data used in this study are secondary data. The data was taken through the official website of the Indonesia Stock Exchange www.idx.com and the official website of the company PT. Agung Podomoro Land, Tbk, namely www.agungpodomoroland.com.
RESULTS AND DISCUSSION Descriptive Statistics
Table 1. Descriptive Statistics Results
From Table 1. above, with n=20, liquidity (CR) has a minimum value of 1.06 and a maximum value of 1.88, with an average (mean) of 1.3570, and a standard deviation of 0.21391. While the solvency (DAR) shows a minimum value of 0.56 and a maximum value of 0.66, with an average (mean) of 0.6085, and a standard deviation of 0.02777. The profitability (ROA) shows a minimum value of 0, and a maximum value of 0.07, with an average of 0.0190, and a standard deviation of 0.01708.
Classical Assumption Test Normality Test
Table 2 Kolmogorov Smirnov . Test
From Table 2 above, the Kolmogorov Smirnov test is the Asymp value. Sig (2-tailed) of 0.036. This means that the value is greater than 0.05 (0.036>0.05). Then the data is normally distributed.
Multicollinearity Test
Table 3 Multicollinearity Test Results
From the table above, it can be concluded that there is no multicollinearity because the multicollinearity test conditions have been met, this is evidenced by the VIF variable value is 1 and the Tolarance Value is not below or equal to 0.1.
Heteroscedasticity Test
Table 4. Heteroscedasticity Test
Judging from the table above, it can be concluded that there is no heteroscedasticity, this is proven by the significant value of each variable which shows greater than
0.05, namely CR 0.395 and DAR 0.743.
Autocorrelation Test
Table 5. Autocorrelation Test
Based on the test results, it can be seen that the value of Asympp.Sig.(2-tailed) is 0.818 which is greater than 0.05, it can be concluded that there is no autocorrelation between inter-period confounding errors, because the autocorrelation test requirements are met.
Multiple Linear Regression Analysis
This analysis is used to determine statistically the relationship between the independent variables, namely liquidity as proxied by (CR) and solvency by (DAR) to the dependent variable, namely profitability as proxied by (ROA), which shows the following results:
Jurnal Ilmiah Socio Secretum, Vol. 10, No. 1, June 2020: 86-92
Table 6. Multiple Linear Regression Test
The multiple regression equation between the independent variable (X) to the dependent variable (Y) is as follows:
Y= -0.055 – 0.017CR + 0.160DAR
This shows that if the value of CR and DAR is zero, then profitability is -0.055, and every 1 unit increase in CR will decrease the ROA value by -0.017, whereas if the DAR value increases by 1 unit, it will increase the ROA value by 0.160.
T . Test Results
Table 7. T . Test Results
Partial test (t) using a significant rate of 5% (α= 0.05 so, two-sided 2.5% or 0.025) with a degree freedom Df(n)-k-1= 20-2-1= 17, then we get ttable = 2.110.
Based on the table of t-test results (partial) can be analyzed as follows: The liquidity variable proxied by CR has a tcount of -0.946 < ttable 2.110 with a significant value of 0.357> 0.05. From these results it can be concluded that liquidity has no effect on profitability. The solvency variable proxied by (DAR) has a tcount of 1.140 < ttable of 2.110, with a significant value of 0.270 which states that it is greater than 0.05, it can be concluded that solvency also has no effect on profitability.
Simultaneous Parameter Significant Test (F Test)
This test is used to determine the effect of all independent variables on the dependent variable together. Here are the results of the F . Test
Table 8. F Test Results
Judging from the distribution table F obtained Ftable = 3.55 and for the value of Fcount can be seen from the table above which shows a value of 1.101 < 3.55 with a significant level of
0.355 > 0.05. Based on this, according to the test criteria, it can be stated that liquidity (CR) and solvency (DAR) simultaneously have no effect on profitability (ROA).
Coefficient of Determination Test Results The coefficient of determination (R2) aims to measure how far the ability of the independent variable to explain the variation of the dependent variable. the value of the coefficient of determination is in the range of 0 to
If the coefficient of determination is close to zero (0), it means that the model's ability to explain the dependent variable is very limited. On the other hand, a value close to 1 means that the independent variable (X) provides almost all the information needed to predict the variation of the dependent variable (Y).
Table 9. Determination Test Results
coefficient of determination (R Square) is 0.115 or equal to 11.5%. This figure means that the liquidity variable (X1) and solvency variable (X2) have an effect on profitability
(Y) is only 11.5%, while the remaining 88.5% is influenced by other variables that are not included in this study.
Result Interpretation
Effect of liquidity (CR) on profitability (ROA)
From the results of the liquidity t test (CR) it has a tcount of -0.946 < ttable 2.110 with value
significant 0.357 > 0.05. From these results it can be concluded that liquidity has no effect on profitability. The results of this study support the research of Arif Budiman (2017) and Murni (2018) which state that liquidity has no effect on profitability and is contrary to the results of research conducted by Hasmita (2015) which states the opposite, namely liquidity (CR) has an effect on profitability (ROA).
The effect of solvency (DAR) on profitability (ROA) The solvency variable proxied by (DAR) has a tcount of 1.140
< t table of 2.110, with a significant value of 0.270 which states that it is greater than 0.05, it can be concluded that solvency also has no effect on profitability. The results of this study contradict the results of research by Arif Budiman (2017) which states that there is a significant influence of solvency on profitability.
Effect of Liquidity (CR) and Solvency (DAR) on Profitability (ROA)
Based on the results of the F test, the results obtained are Ftable = 3.55 and for the Fcount value of 1.101, or 1.101 < 3.55 with a significant level of 0.355 > 0.05. Based on this, according to the test criteria, it can be stated that liquidity (CR) and solvency (DAR) simultaneously have no effect on profitability (ROA).
CONCLUSION
Based on the analysis and discussion that has been carried out in previous chapters, the conclusions obtained are as follows: A regression model that uses cash turnover and inventory turnover variables on company profitability in this case is the ROA variable, the equation Y = -0.055 - 0.017X1 + 0.160X2 Liquidity ratio partially has no effect on profitability. This statement is based on the results of the partial test (t test), where liquidity as proxied by the Current Ratio (CR) has a tcount of -0.946 while a ttable of 2.110 which means tcount
< from ttable, with a significance value of 0.357 > 0.05 Solvency partially has no effect on profitability. The statement is based on the results of the partial test (t test), where the solvency as proxied by the Debt to Asset Ratio (DAR) has a tcount of 1,140 while a ttable of 2,110 means that tcount < t table, with a significance value of 0.270> 0.05. Simultaneous liquidity and solvency also have no effect on profitability. The statement is based on the results of the simultaneous test (F test), where the result of Fcount has a value of 1.101 while Ftable is 3.55, which means Fcount < Ftable, with a significance level of 0.355 > 0.05. The value of R square is 0.115 or equal to 11.5%. This figure means that the liquidity variable (X1) and solvency variable (X2) affect profitability (Y) only by 11.5%, and it can be concluded that the influence of the independent variable (X) on the dependent variable (Y) is very weak and in explaining the dependent variable is also very limited.
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