Proceeding of World Conference
Vol. 1 No. 2 (2019): November 2019

CAPITAL STRUCTURE ANALYSIS TO OPTIMIZE THE PROFITABILITY OF MSMES (CASE STUDY ON MSMES HIKMAH IN SIDOARJO, EAST JAVA, INDONESIA)

Danur Ramadhani (Bachelor of Management Student, Universitas Narotama, Departement of Economics and Business)
Agus Sukoco (Economics and Business Faculty Management and Marketing Study Program Narotama University Surabaya)
Joko Suyono (Faculty of Economics and Business Management Study Program Narotama University Surabaya)



Article Info

Publish Date
21 Nov 2019

Abstract

This study aims to analyze the capital structure used to optimize profitability in MSME embroidery shoes. This study uses descriptive research with a qualitative approach. The analytical method is used Weighted Average Cost Of Capital (WACC). The techniques of data collection in this research used interview, observation, documentation and triangulation methods. The data that used are financial transaction records and financial statements issued by the company itself. The results showed that UD. Hikmah used the composition of the capital structure consisting of debt of 20%, 80% own capital with a ROE rate of 170%. Optimization results obtained the optimal capital structure composition on the composition of debt 23% and own capital 77%. By generating a level of profitability that can provide a favorable return for business owners, with the highest calculation of ROE that is equal to 173% and the cost of capital to be borne is Rp.18.238.000 every year.

Copyrights © 2019






Journal Info

Abbrev

prd

Publisher

Subject

Economics, Econometrics & Finance Education Engineering Mathematics Medicine & Pharmacology

Description

Proceeding of World Conference, is Publication of conference articles in the field of multidisciplinary sciences published by the World conference; aims to make it easier for readers and writers to access articles during time and make it easier to download and distribute. ...