Analysis of Financial Distress in the Consumer Goods Industry Listed on the Indonesia Stock Exchange Post-COVID-19 Pandemic Using the Altman Z-Score Method

Abstract

This study aims to empirically examine whether Net Working Capital to Total Assets, Retained Earnings to Total Assets, EBIT to Total Assets, and Book Value of Equity to Book Value of Total Debt affect Financial Distress in companies within the Consumer Goods Sector listed on the Indonesia Stock Exchange post-COVID-19 pandemic using the Altman Z-Score method. The population of this study consists of companies in the Consumer Goods Sub-sector listed on the Indonesia Stock Exchange. The sample used includes 52 companies obtained using the saturated sampling technique (Census Technique). The data analysis methods employed are the Modified Altman Z-Score Model III and Logistic Regression Test. The independent variables (X) in this study are Net Working Capital to Total Assets, Retained Earnings to Total Assets, EBIT to Total Assets, and Book Value of Equity to Book Value of Total Debt, while the dependent variable (Y) is Financial Distress. The data for this study uses secondary data, specifically annual reports. The results of the study indicate that, partially, Net Working Capital to Total Assets, Retained Earnings to Total Assets, EBIT to Total Assets, and Book Value of Equity to Book Value of Total Debt do not have a significant effect on the occurrence of financial distress.