THE IMPACT OF ECONOMIC VALUE ADDED AND LEVERAGE TOWARD MARKET VALUE ADDED IN FOOD AND BEVERAGES INDUSTRY

Abstract

This study examined the impact of Economic Value Added, Degree of Operating Leverage, Degree of Financial Leverage, and Degree of Total Leverage on Market Value added. This study utilized the EVA and leverage (DOL, DFL and DTL) as independent variables and MVA as independent variable. In addition, this research also identified the most significant influence factor towards Market Value Added. This research chose the population in food and beverages industry during the period of 2011-2015 that listed in Indonesia Stock Exchange. Through purposive sampling and panel data which was obtained from official websites of each firm and Indonesia Stock Exchange, this research had 30 observations from six firms in five consecutive years which fulfilled the criteria. This research adopted quantitative research with fixed effect model, which used some analysis methods of descriptive analysis, classical assumption, multiple regression analysis and hypothesis testing. Based on the result, it was concluded that EVA, DOL, and DFL had partial significant influences towards MVA in food and beverages industry. Simultaneously, those four independent variables provided 76.823% influences towards MVA while the rest 23.177% was influenced by other factors.