Abstract:
This study aims to analyze financial ratios' effect on financial distress predictions in the Indonesian mining industry. Adopt quantitative research and have 50 units of observational data from 5 samples from 2010 - 2019. This study's financial ratios are return on assets, interest coverage ratio, current ratio, and total log assets. Meanwhile, the dependent variables are a short-term debt to total equity ratio, and long-term debt to total equity ratio is chosen to be a proxy for predicting the condition of financial distress. In a study using two dependent variables because debt is considered borrowings made by the business from outsiders who are paid a periodic amount of interest on the money borrowed, debt should not be considered homogeneous. Total debt should be analyzed together with short-term and long-term debt. The results showed an R-squared adjustment value between return on assets, interest coverage ratio, current assets ratio, and total asset log of 34.34%, simultaneously affecting financial predictions that emphasize short-term debt to total equity ratio as a Proxy. Meanwhile, the R-squared Adjustment value between return on assets, interest coverage ratio, current assets ratio, and total log assets is 55.94%, simultaneously influencing financial predictions that are stressed against long-term debt to total equity ratio as a Proxy.
