Asian Journal of Research in Banking and Finance
  • Year: 2016
  • Volume: 6
  • Issue: 9

The study of the relation between debt and profitability ratios separately for profit smoother and Non-smoother Company

  • Author:
  • Fatemeh Mohammadian Khosravi, Mohammad Azim khodayari, Esmaeil Kakeh Baraie
  • Total Page Count: 10
  • Page Number: 53 to 62

*Department of Financial Management, Malayer Branch, Islamic Azad University, Malayer, Iran

**Department of Financial Management, Malayer Branch, Islamic Azad University, Malayer, Iran

***MSc, Graduated Public Administration, Payam Noor University, Tehran, Iran

Online published on 5 November, 2016.

Abstract

This study examined the relation between debt and profitability ratios separately for income smoother and Non-smoother Company. The study community includes the company listed in Tehran Stock Exchange (TSE) and the study period is between 2008 and 2012. For this, using the company was classified into two groups of income smoothing and non-smoothing company using ECKEL index. Correlation and regression testing is used to analyse the data. The findings showed that there is a significant relation between debt and asset ratios and profitability ratios in smoothers and Non-smoothers Company, and income smoothing has no effect on the relation between debt ratios and profitability ratios of companies.

Keywords

Debt ratios, income smoothing, profitability ratios, Smoother Company, Non-Smoother Company