Management and Economics Journal (MEC-J)
Vol 5, No 1 (2021)

Analysis of Working Capital Management in Automotive Industry Sector Listed in Indonesia Stock Exchange

Satriya Candra Bondan Prabowo (Universitas Brawijaya)
Rini Safitri (Universitas Islam Negeri Maulana Malik Ibrahim Malang)



Article Info

Publish Date
26 Apr 2021

Abstract

This study aims to determine the analysis of working capital management in automotive industry sector listed on the Indonesia Stock Exchange. The object of the study consisted of 12 companies included in the automotive industry sector which were listed on the Indonesia Stock Exchange from 2014 to 2018. The results showed that the average collection period, inventory collection period, average payment period, and cash conversion cycle showed fluctuating results during the study period . The less time it takes for a company to collect receivables, the more liquid a company is. While the less time needed to convert raw materials into finished goods shows good results because the inventory will not be too long in the warehouse so that it will reduce costs. The average payment period is relative for each company. That's because every company has a debt agreement with a certain period. The less time needed by the company since the raw materials purchased are paid until the trade receivables from the sale are billed, the better for the company because the faster the time needed to turn money into goods and into cash back which will increase company profits.

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Journal Info

Abbrev

mec

Publisher

Subject

Decision Sciences, Operations Research & Management Economics, Econometrics & Finance Social Sciences

Description

Management and Economics Journal (MEC-J) is a peer-reviewed and open access journal that focuses on management and economics fields. This journal publishes original articles, reviews, and also interesting case reports. Letters and commentaries of our published articles are welcome. Subjects suitable ...