Jurnal Pendukung 5

International Journal of Business, Accounting and Management
ISSN : 2527-3531 | Volume 4, Issue 1, 2019

www.doarj.org
THE EFFECT OF CURRENT RATIO AND DEBT TO EQUITY

RATIO ON NET PROFIT MARGIN AT PT. MENARA
NUSANTARA IN 2009-2018
Karnawi Anwar
The Lecturer of STIE Insan Pembangunan
Email: [email protected]
Abstract: This research aims to find out the effect of the Current Ratio and Debt to Equity Ratio both
simultaneously and partially on Net Profit Margin at PT. Menara Nusantarain 2009-2018. The
population and sample in this research namely the financial statements of PT. Menara Nusantara in
2009-2018. The data analysis used was a simple linear regression test and multiple linear regression
test. While the hypothesis test used namely the t-test for partial and f-test for multiple. The result showed
that both partially and simultaneously there was a significant effect on the Current Ratio and Debt to
Equity Ratio on Net Profit Margin at PT. Menara Nusantara in 2009-2018.
Keywords: Current Ratio, Debt to Equity Ratio, and Net Profit Margin
I. INTRODUCTION
Background
The rapid development of business and industry has led to increasingly fierce competition
not only within the country but also among countries. For this reason, the company management
must be able to deal with and adapt to developments that occur by being able to utilize all of its
resources. The more open the international market, the company must be able to expand the
market and open opportunities to increase capital, through the capital market.
Every company should pay attention to the capital component owned . If the company has
debt funding that is greater than its capital, then it willincrease the risk and generally the owner
of the company wants a large return, even though the company has debt on the debtor. Regarding
to the debt, even large company is inseparable from debt.In the business world not everything
runs smoothly, leverage means a lever or heaver (literally), a lever is usually used to help lift a
heavy burden (Hanafi, 2016: 327) in financial leverage,it aims to increase expected profits.
Generally, the company founded to achieve the goal, which is to make a profit. The profits
obtained are used for business development and shared with company owners. The profit and
loss statement is a financial statement that shows that a company earning profits or suffering
losses. Through this statement, it can be known the company's financial performance, especially
as seen from the financial performance that is increasing. If the company achieves good
performance, it will attract more investors.
Liquidity ratio is a ratio that illustrates the company's ability to meet short-term obligations
(debt). Both obligations to external company (business entity liquidity) and internalcompany
(company liquidity).In this case, the liquidity ratio used is the Current Ratio (CR). Kasmir (2015:
134) states that Current Ratio is a ratio to measure a company's ability to pay short-term
obligations or debt that is due immediately when billed as a whole. In other words, how much
current assets are available to cover short-term liabilities that are immediately due.
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The Effect Of Current Ratio And Debt To Equity Ratio On Net Profit Margin At
PT. Menara Nusantara in 2009-2018
While solvency ratio is measuring a company's ability to meet the long-term obligations, a
company that is not solvable is a company which the total debt is greater than its total
assets.Generally, the solvency ratio used is Debt to Equity Ratio (DER). Whereas, the Net Profit
Margin (NPM) is one of the ratios used to measure the profit margin on sales.The way to
measure this ratio is to compare net profit after tax with net sales. This ratio is also known as the
profit margin.
The following are empirical data on PT. Menara Nusantara in 2016-2018 relates to the
variables used in this research, namely: Current Ratio, Debt to Equity Ratio, and Net Profit
Margin. They can be seen in the following table:
Table.1 Growth in CR, DER, and NPM

Year
Variable 2016 2017 2018
CR (%) 650.876 236.533 225.017
DER (%) 152.585 118.361 106.255
NPM(%) 2.890 8.436 7.567
Source: Data Processed (2018)
Based on the table above, it shows the value of the Current Ratio (CR) every year has
decreased, it is mean that the company each year is less able to meet or pay short-term
obligations properly.While the value of Debt to Equity Ratio (DER) has also decreased every
year, it is mean that the company has sufficient funding to finance its assets and can pay it on
time.Whereas the Net Profit Margin (NPM) at PT. Menara Nusantara shows an increasing and
decreasing trend every year which means the company is not getting a profit because the
company's management is ineffective and inefficient in terms of sales levels.
Research Question
Based on the background that has been described above, the research question is: How is the
effect of the Current Ratio and Debt to Equity Ratio both simultaneously and partially on Net
Profit Margin at PT. Menara Nusantara in 2009-2018?
Research Objective
The objective of this research is to find out the effect of the Current Ratio and Debt to
Equity Ratio both simultaneously and partially on Net Profit Margin at PT. Menara Nusantara in
2009-2018.
Benefits of Research
A research must have benefits, as for the expected benefits for the company, namely: as
input to management, especially in making corporate investment decisions by using its capital to
develop its business.While academically this research is expected to be used as reference
material for other researchers who want to conduct the research with the same problem.
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THEORETICAL BASIS
Financial Management
Many experts who define financial management, such as James C. Van Home in Kasmir
(2016: 5) states that financial management is all activities related to the acquisition, funding, and
management of assets with some overall objectives.Furthermore, according to Sutrisno (2015: 3)
states that financial management or often called expenditure can be interpreted as all company
activities related to efforts to get funds at low cost and efforts to use and allocate these funds
efficiently.
Based on the explanation above, it can be concluded that financial management is the way
how to obtain assets, fund assets, manage assets to achieve overall corporate goals.
There are three main functions of financial management decision making according to
Harjito and Martono (2015: 4), namely decisions relating to investment, funding decisions, and
asset management decisions. Funding decisions, in this decision financial managers are required
to consider and analyze a combination of economic sources of funds for the company to finance
investment needs and business activities (Sutrisno, 2015: 5). The funding decision itself is
related to the number of funds that must be provided by the company, both debt, and equity.
Financial Performance
The performance of a company can be reflected through the performance that has achieved
in a certain period. According to the Indonesian Dictionary, performance is (1) something that is
achieved (2) performance shown (3) workability ".The performance is an important thing that
must be achieved by every company everywhere because performance is a reflection of the
company's ability to manage and allocate its resources. Financial performance is a description of
the financial condition of a company that is analyzed with financial analysis tools so that it can
be known about the good and bad financial condition of a company that reflects work
performance in a certain period.Furthermore, Fahmi (2016: 2) states that financial performance
is an analysis conducted to see the extent to which a company has implemented financial
management by using the rules of financial implementation properly and correctly ".
Definition of Financial Statement

Every company in Indonesia is required to make financial statement because financial
statement has an important role that aims to provide information relating to the financial
position, performance, and changes in the financial position of a company that is useful for
management in economic decision making (Hery 2016: 2). There are several definitions of
financial statements according to several experts, namely: Kasmir (2015: 7) states that financial
statement isa report that show the company's current financial condition or in a certain period.
Fahmi (2015: 2) states that financial statement is an information that describes the financial
condition of a company, and further information can be used as an illustration of the company's
financial performance. Jumingan (2017: 4) states that financial statement is the result of an
accounting process that can be used as a tool to communicate with interested parties with the
financial condition and results of company operations.
Furthermore, from the above definition, it can be concluded that the financial statement is a
process of recording financial transactions for a certain period that are used to provide
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information that describes the financial performance of a company to the parties concerned and
used as a reference for decision making in the coming period.
Fraser and Ormiston in Fahmi (2015: 22) state that "a corporate annual statement consists of
four main financial statements", namely: balance sheet, profit and loss statement, equity
statement, and cash flow statement.
Analysis of Financial Statement

To know exactly how the company's financial condition and performance, an analysis of its
financial statement can be carried out. Agus and Martono (2015: 51) states "Financial Statement
Analysis is an analysis of the financial condition of a company which involves a balance sheet
and profit and loss".Jumingan (2015: 42) states "Analysis of financial statements includes a
review of relationships and trends to find out whether the financial condition, results of
operations and financial progress of the company are satisfactory or unsatisfactory".
Analysis of Financial Ratio

An assessment of a company's financial condition is affected by many factors that contribute
to changes in financial conditions, such as micro and macroeconomic conditions that occur at the
domestic and international levels (Irham Fahmi, 2015: 107).The financial performance indicators
will be reflected by ratios, for public companies these ratio indicators will be an urgent focus in
decision-making. The purpose of financial analysis is to identify any weaknesses in the financial
situation that can cause problems in the future and it can determine the advantages that can be
used to expand the business. Besides that, the analysis used by outside company can be used to
determine the level of credibility or investment potential (Kamaludin and Rini, 2015: 33). Based
on these definitions, it can be concluded that financial ratio is a tool for analyzing the financial
condition of a company that explains the relationships and financial indicators of a company.
Current Ratio
Irham Fahmi (2015: 121) states that the Current Ratio is a commonly used measure of short-
term solvency, the ability of a company to meet debt needs when due. Whereas, Sugiono and
Untung (2016: 58) define the Current Ratio is the ratio used to determine the extent to which a
company's current assets are used to pay off current liabilities that will be due or paid
immediately.Prastowo (2015: 74) states that the current ratio is the elements used in the
calculation of working capital by comparing between total current assets and current debt.
Furthermore, Kasmir (2015: 135) formulates the current ratio as follows:
Current Assets
Current Ratio =
Current Liabilities)
Current Ratio is affected by several things. If a company sells securities classified as current
assets and uses cash obtained to finance the company's acquisition of another company or other
activity, the current ratio may decrease.
Debt to Equity Ratio
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The solvency ratio or leverage ratio according to Kasmir (2015: 158) is a ratio used to
measure the extent to which a company's assets are financed with debt. This means how much
debt burden is borne by the company compared to its assets. The formula to find Debt to Equity
Ratio can be used a comparison between total debt with total equity, namely:
Total amount of Debt

Debt to Equity Ratio =
Equity
Net Profit Margin

Kasmir (2016: 200) states that Net Profit Margin is a profit measure that compares profits
after interest and taxes compared to sales. This ratio shows the company's net income from sales.
Wenner R. Murhadi (2015: 64) states that Net Profit Margin reflects the company's ability to
generate net income from each income or sale.Based on these definitions, it can be concluded
that the Net Profit Margin is the ability of a company to get profits from every sale made and
deducted interest and taxes that become obligations. The formula to find the Net Profit Marginis:
Net Profit
NET PROFIT MARGIN =
Sales
Theoritical Framework
The theoretical framework proposed in this research aims to facilitate understanding of
thought. The picture of theoretical framework as follows:
Current Ratio (X1)

Net Profit Margin
Debt to Equity Ratio (Y)
(X2)
Picture.1Theoritical Framework
Hypothesis
Noor (2015: 89) states that the hypothesis is a temporary answer to the research question.
Thus, there is a link between the formulation of the problem with the hypothesis, because the
formulation of the problem is a research question. The research hypothesis is formulated as
follows: there is an effect between Current Ratio and Debt to Equity Ratio, both simultaneously
and partiallyon the Net Profit Margin at PT. Menara Nusantara.
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METHODOLOGY
Research Design
The research design is essentially a design or blueprint for conducting a research, both
simultaneously and partially. It is simultaneously all the processes required in planning and
implementing research, while partially it is a depiction of the relationship or effect between
variables, collection, and analysis data, so that it can easily explain the interrelationships
between variables in the research.
Sugiono (2018: 37) states that associative causality research is a research that shows a
causal relationship where there are independent variables (variables that influence) and
dependent variables (variables that influenced). Based on the type, this research is quantitative,
which the data is in the form of numbers.
Research Variable
Kerlinger in Sugiono (2018: 38) states that variables are constructs or properties that will
be studied, this research consists of two variables: Independent variables in the form of Current
Ratio (X1) and Debt to Equity Ratio (X2), and the dependent variable in this research is Net
Profit Margin (Y).
Population and Sample

Population is essentially not just the amount that exists on the object or subject studied but
includes all the characteristics or properties possessed by the subject or object being studied. The
population in this research was the financial statement of PT. Menara Nusantara in 2009-2018.
While the sample is part of the number and characteristics possessed by the population. The
sample in this research was the financial statement of PT. Menara Nusantara.
Data Collecting Method

Collecting data is the most important thing done in a research, data collected used for
subsequent analysis. The data in this research are secondary data. Secondary data is data
obtained from various sources that already exist. In this research, the data collection method used
was the documentation method through the collection of documents in the form of balance sheet
and profit and loss statement of PT. Menara Nusantara in 2009-2018.
Data Analysis Method

The method of analysis was carried out with the Statistical Package for Social Science
(SPSS) program. The SPSS processed data includes the Current Ratio, Debt to Equity Ratio on
Net Profit Margin so that the mean value and standard deviation of each variable can be known.
The mean value and standard deviation according to Sofyan Siregar (2015: 44 & 47), states that
each variable can be calculated with the following formula:
∑X₁ ∑(Xi− X)²
X= for mean, and s = for standard deviation
n n−1
Classical Assumption Test

The classical assumption test needs to be done to test whether the regression model used in
the research is feasible or not to be used. The classical assumption test was obtained by using the
normality test, multicollinearity test, heteroscedastic test, and autocorrelation test.
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Regression Testing
a. Simple Linear Regression
Simple linear regression analysis aims to predict the value of the dependent variable
influenced by the independent variable. (Sofyan Siregar, 2015: 220). The simple linear
regression formula is:
Yˈ = a + bX
b. Multiple Linear Regression
Multiple linear regression analysis is an analysis to determine the effect of more than one
independent variable on one dependent variable Sofyan Siregar (2015: 226). The multiple
linear regression formula is:
Yˈ = a + b1X1 + b2X2
Hypothesis Testing
a. T-test (Partial)
Each correlation coefficient produced needs to be tested by using the t-test to find out
the significance of each correlation. The t-test is calculated by the following formula:
rX₁Y n − 2
t=
1 − r2
b. F-test (Simultaneous)
F-test (simultaneous), is used to test the effect of the overall independent variable X on
the variable Y. This F-test is done by comparing the calculated F value with the F table value,
which is formulated as follows:
r 2 / (k − 1)
F=
1 − r 2 /(n − k)
Coefficient of Determination
The coefficient of determination (Kd) is a number that states or used to determine the
contribution made by a variable or more X (independent) to the variable Y (dependent). The
formula used is as follows:
Kd = r² x 100%
The magnitude of the coefficient of determination value shows the amount of contribution
of variable X (independent) to variable Y (dependent).
ANALYSIS AND DISCUSSION

Research Data
Descriptive Statistics
a. Current Ratio
Current Ratio is the result of the distribution of current assets with current liabilities. The
results of the calculation of descriptive analysis of the Current Ratio variable can be presented
in the following table.
Table.7 Descriptive Analysis of Current Ratio Variables
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Minimu Maximu Std.

N m m Mean Deviation
CR 10 2.09 2.76 2.4040 .20818
Valid N 10
(listwise)
Source: Secondary Data Processed 2018 with SPSS v.18

3.00
2.50
2.00
1.50
CR
1.00
0.50
0.00
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Graph.1 Descriptive Analysis of Current Ratio Variable
The table and graph above show the Current Ratio variable at PT. Menara Nusantara. It has
a mean of 2.40 times and a standard deviation of 0.20 times. The minimum value of the Current
Ratio was 2.09 times and the maximum value was 2.76 times. Based on the data obtained, it
showed that the value of the Current Ratio of PT. Menara Nusantara experienced an upward and
downward trend.
The small value of the Current Ratio shows that the company has little working capital
(current assets) to pay short-term obligations, while the high Current Ratio shows that the
company has enough or more working capital (current assets) to pay for its short-term
obligations.
Table.8 Descriptive Analysis of the Debt to Equity Ratio Variable

Minimu Maximu Std.
N m m Mean Deviation
DER 10 1.03 1.72 1.3040 .27762
Valid N (listwise) 10
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2.00
1.50
1.00
0.50 DER
0.00
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Graph.2 Descriptive Analysis of Debt to Equity Ratio Variable
The table and graph above show that the Debt to Equity Ratio variable at PT. Menara
Nusantara has a mean of 1.30 times and a standard deviation of 0.27 times. The minimum value
was 1.03 times and the maximum was 1.22 times. A low Debt to Equity Ratio indicates that the
company has a large amount of capital to pay its debts, while a high Debt to Equity Ratio
indicates that the company has a small amount of capital that can be used as collateral to pay
debts.
Table.9 Descriptive Analysis of Net Profit Margin variable

Std.
N Minimum Maximum Mean Deviation
NPM 10 .03 .09 .0700 .01764
Valid N (listwise) 10

0.10
0.08
0.06
NPM
0.04
0.02
0.00
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Graph.3 Descriptive Analysis of Net Profit Margin Variable
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According to the table and graph above show that the Net Profit Margin variable at PT.
Menara Nusantara has a mean of 0.07 times and a standard deviation of 0.12 times. The
minimum value was 0.03 times and the maximum value was 0.09 times. A low Net Profit
Margin value indicates that the company has a low level of sales, while a high Net Profit Margin
shows a high level of sales.
Classical Assumption Test

a. Normality Test
In this research, the normality test aims to test whether in the regression model, the
dependent variable and the independent variable have normal contributions or not. The decision-
making in this test by looking at the following P-P plot graph and histogram graph:
Graph.4 Histogram of Normality Test

Graph.5 P-P Plot Normality Test
Based on graph 5, the dots followed and approached the diagonal line, so that it can be
concluded that the regression model meets the normality test.
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b. Multicollinearity Test
Multicollinearity test is used to find out whether the regression model found a correlation
between independent variables. Multicollinearity test results can be seen in the following table:
Table.10 The Result of Multicollinearity Test

a
Coefficients
Unstandardized Standardized Collinearity
Coefficients Coefficients Statistics
Model Std. Toleranc
B Error Beta t Sig. e VIF
1 (Constant) .024 .061 .398 .702
CR .037 .024 .438 1.56 .163 .999 1.002
1
DER -.033 .018 -.525 - .103 .999 1.002
1.87
2
a. Dependent Variable: NPM
The table above shows the results of calculations, multicollinearity test by using SPSS.
From these data, the tolerance value was more than 0.1 and the VIF value was less than 10. It
can be concluded that the regression model equation did not contain multicollinearity problems.
c. Heteroscedastic Test
Heteroscedastic test aims to test whether in the regression variance occurs residuals from
one observation to another observation. A good regression model does not occur
heteroscedasticity. The method used to test heteroscedastic in this research was a scatterplot
diagram.

Graph.6 Scatterplot Diagram
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Based on the graph above, it can be seen that there were no clear patterns, irregular
points, and points spread above and below 0 on the Y axis, it can be concluded that the
regression model did not occur heteroscedastic.
Simple Linear Regression Test

a. Current Ratio on Net Profit Margin
Table. 17CR-NPMLinear Regression
Coefficientsa
Unstandardized Standardized
Model Coefficients Coefficients
B Std. Error Beta T Sig.
1 (Constant) -.015 .066 -.229 .824
CR .035 .027 .418 1.300 .230
Based on the table above, the Current Ratio on Net Profit Margin regression equation as
follows:
NPM = -15 + 35 CR
Through this equation, it can be concluded that if the Current Ratio is 0 (zero), then the
Net Profit Margin is -15, and if there is an additional 1 unit of Current Ratio, the Net Profit
Margin will increase by Rp.35.
b. Debt to Equity Ratio terhadap Net Profit Margin

Table.18 DER-NPM Linear Regression
Coefficientsa
Std.
B Error Beta T Sig.
1 (Constant) .112 .026 4.356 .002
DER -.032 .019 -.508 -1.669 .134
Based on the table above, then the Debt to Equity Ratio regression equation on the Net
Profit Margin is as follows:
NPM = 112 - 32 DER
Through this equation, it can be concluded that if the Debt to Equity Ratio is worth 0
(zero), then the Net Profit Margin is Rp. 112, and if an additional 1 unit of Debt to Equity
Ratio occurs, the Net Profit Margin will decrease by Rp.32.
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Multiple Linear Regression Test

Table.19 Multiple Linear Regression
Coefficientsa
1 (Constant) .024 .061 .398 .702
CR .037 .024 .438 1.561 .163
DER -.033 .018 -.525 -1.872 .103
Based on the table above, then the multiple linear regression equation is as follows:
NPM = 24 + 37 CR – 33 DER
Through this equation, it can be concluded that the constant value of Rp. 24. It is mean that
if the Current Ratio and Debt to Equity Ratio are 0 (zero) then the Net Profit Margin value is
Rp.24. The b1 value is Rp. 37, so it can be interpreted if there is an increase in 1 (one) unit of
Current Ratio while the Debt to Equity Ratio is ceteris paribus, then the value of Net Profit
Margin will increase by Rp. 37.
Partial Hypothesis Testing (T-test)

a. Current Ratio on Net Profit Margin
Table. 20 T-test of CR - NPM

Coefficientsa
1 (Constant) -.015 .066 -.229 .824
CR .035 .027 .418 1.300 .230
Based on the table above, it is known that the t-value of 1,300 with a sig value of 0.230.
When compared with the value of the t-table for df = 10 at a significance level of 0.05 of 1.859,
the t-value is smaller than t-table. The significance value of 0.230 indicates a value that greater
than the predetermined significance value of 0.05.
b. Debt to Equity Ratio on Net Profit Margin
Table.21 T-test of DER - NPM
Coefficientsa
Model Coefficients Coefficients T Sig.
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B Std. Error Beta

1 (Constant) .112 .026 4.356 .002
DER -.032 .019 -.508 -1.669 .134
Based on the table above, it is known the t- value of 1.669 with a sig value of 0.134. When
compared with the value of t-table for df = 10 at a significance level of 0.05 of 1.859, the t-value
is smaller than t-table. The significance value of 0.134 indicates a value that greater than the
predetermined significance value that is equal to 0.05.
b. Current Ratio, Debt to Equity Ratio on Net Profit Margin
Table.22 T-test of CR, DER - NPM

Coefficientsa
1 (Constant) .024 .061 .398 .702
CR .037 .024 .438 1.561 .163
DER -.033 .018 -.525 -1.872 .103
Based on the table above, it can be seen that the t-value is calculated simultaneously for the
Current Ratio of 1.561 with a sig value of 0.163. When compared with the value of t-table for df
= 10 at a significance level of 0.05 of 1.859, the t-value is smaller than t-table. While the t-value
is calculated simultaneously for Debt to Equity Ratio of 1.8872 with a sig value of 0.103. When
compared with the value of t-table for df = 10 at a significance level of 0.05 of 1.859.
Simultaneous Hypothesis Testing (F-test)

Table.23 F-test
b
ANOVA
Sum of Mean
Model Squares Df Square F Sig.
1 Regression .001 2 .001 2.862 .124a
Residual .002 7 .000
Total .003 9
a. Predictors: (Constant), DER, CR
b. Dependent Variable: NPM
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The table above shows that the F-count was 2.862 with a sig value of 0.124. When
compared with the table's F-value for df = 10 at a significance level of 0.05 of 4.74, the value of
F-count> F-table. The significance value of 0.124 indicates a greater value at a predetermined
significance level of 0.05. From the hypothesis testing, it can be said that the hypothesis reads
that there is an effect of the Current Ratio and Debt to Equity Ratio on Net Profit Margin at PT.
Menara Nusantara in 2009-2018.
Coefficient of Determination
1. Current Ratio and Net Profit Margin
Table.14 Coefficient Determination of CR-NPM
Model Summary
Model R R Adjusted R Std. Error of the
Square Square Estimate
a
1 .418 .174 .071 .01700
a. Preditors: (Constant), DER, CR
Based on the table above, the coefficient of determination (R Square) of 0.174. So the
effect of the Current Ratio on Net Profit Margin is 17.4%, and the remaining 82.6% is
affected by variables.
2. Debt to Equity Ratio and Net Profit Margin

Table.15Coefficient Determination of CR-NPM
Model Summary
a
1 .508 .258 .166 .01611
b. Preditors: (Constant), DER, CR
effect of the Current Ratio on Net Profit Margin is 28.4%, and the remaining 71.6% is
affected by other variables.
3. Current Ratio, Debt to Equit Ratio and Net Pofit Margin.

Table. 16 Coefficient Determination of CR,DER-NPM
Model Summary
1 .671a .450 .293 .01483
c. Preditors: (Constant), DER, CR
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effect of the Current Ratio on Net Profit Margin is 45%, while the remaining 65% is affected
by other variables.
CONCLUSION AND SUGGESTION

Conclusion
Based on the description and the results of research on the Effect of Current Ratio and
Debt to Equity Ratio on Net Profit Margin at PT. Menara Nusantara in 2009-2018 ", it can be
concluded that:
a. The mean of Current Ratiowas 2.40 times with a standard deviation of 0.20 times. The mean
of Debt to Equity Ratio variable was 1.30 times with a standard deviation of 0.27 times. The
mean of Net Profit Margin variable was 0.07 times with a standard deviation of 0.12 times.
b. The Current Ratio affected the Net Profit Margin at PT. Menara Nusantara.
c. The Debt to Equity Ratio affected the Net Profit Margin at PT. Menara Nusantara.
d. The Current Ratio and Debt to Equity Ratio did not affect the Net Profit Margin at PT. Menara
Nusantara. The regression model NPM = 24 + 37 CR - 33 DER.
Suggestion
Based on the research results and conclusions, several suggestions are as follows: Through
this research it is expected that company management must always monitor the movement of the
company's Net Profit Margin, this is very important to know the success of the company's
performance in increasing profits and to know the response of investors to their desire to invest.
As for investors, the results of the research are expected to be used as information to understand
and pay attention to other ratios related to Net Profit Margin which will be used for investment
decision making, so investors can consider macroeconomic fundamentals, such as inflation,
interest rates, government, social and political and foreign exchange rates.
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Jurnal Pendukung 5

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International Journal of Business, Accounting and Management

ISSN : 2527-3531 | Volume 4, Issue 1, 2019

THE EFFECT OF CURRENT RATIO AND DEBT TO EQUITY

Table.1 Growth in CR, DER, and NPM

Source: Data Processed (2018)

Definition of Financial Statement

Analysis of Financial Statement

Analysis of Financial Ratio

Debt to Equity Ratio

Total amount of Debt

Net Profit Margin

Current Ratio (X1)

Population and Sample

Data Collecting Method

Data Analysis Method

Classical Assumption Test

ANALYSIS AND DISCUSSION

Table.7 Descriptive Analysis of Current Ratio Variables

Minimu Maximu Std.

Source: Secondary Data Processed 2018 with SPSS v.18

Graph.1 Descriptive Analysis of Current Ratio Variable

Table.8 Descriptive Analysis of the Debt to Equity Ratio Variable

Source: Secondary Data Processed 2018 with SPSS v.18

Graph.2 Descriptive Analysis of Debt to Equity Ratio Variable

Table.9 Descriptive Analysis of Net Profit Margin variable

Source: Secondary Data Processed 2018 with SPSS v.18

Graph.3 Descriptive Analysis of Net Profit Margin Variable

Classical Assumption Test

Source: Secondary Data Processed 2018 with SPSS v.18

Graph.4 Histogram of Normality Test

Source: Secondary Data Processed 2018 with SPSS v.18

Table.10 The Result of Multicollinearity Test

Source: Secondary Data Processed 2018 with SPSS v.18

Simple Linear Regression Test

b. Debt to Equity Ratio terhadap Net Profit Margin

Multiple Linear Regression Test

Partial Hypothesis Testing (T-test)

Table. 20 T-test of CR - NPM

B Std. Error Beta

b. Current Ratio, Debt to Equity Ratio on Net Profit Margin

Table.22 T-test of CR, DER - NPM

Simultaneous Hypothesis Testing (F-test)

2. Debt to Equity Ratio and Net Profit Margin

3. Current Ratio, Debt to Equit Ratio and Net Pofit Margin.

CONCLUSION AND SUGGESTION

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