The Relationship Between Capital Structure and Performance

• Main Authors: Lu Jar Rong, 呂佳蓉
• Other Authors: James C. Chan
• Format: Others
• Language: zh-TW
• Published: 2001
• Online Access: http://ndltd.ncl.edu.tw/handle/48538557464338618713

碩士 === 東吳大學 === 會計學系 === 89 === In this paper, 93 electronic companies in Taiwan during 1985 to 1989 were selected to research the relationship between capital structure and operating performances. The agent variables of capital structure were: Retained-Earnings Ratio, Short-term Debts Ratio, Long-term Debts Ratio, and Debts Ratio. Then, 11 performance variables were extracted from the four dimensions of Balanced-Scorecard as Cash-flow Adequacy Ratio, Sales Growth Ratio, Net Income Ratio, Return on Owners'''''''' Equity Ratio, Market Share Ratio, Sales Return Ratio, R&D Performance Ratio, Cash Flow Cycle, Warrant Expenses Ratio, Operating Revenue-per-employee, and Salaries-per-employee. Factor Analysis was used to split them into 4 groups, thus these groups were named Financial Performance Index, Innovation and Learning Performance Index, Customer Performance Index, and Internal Process Performance Index. Then, the new factor scores were used as independent variables of the multiple regression model, and the 4 capital structure ratio used as dependent variables. The statistics results of null hypotheses were as follows: (1)Reject the null hypothesis of "Retained- Earnings Ratio not affected by operating performances". To be more specific, Financial Performance Index and Internal Process Index were relevant to the Retained-Earnings Ratio, while Innovation and Learning Performance Index and Customer Performance Index were not. (2)Reject the null hypothesis of "Short-term Debts Ratio not affected by operating performances". To be more specific, Financial Performance Index, Innovation and Learning Performance Index, Customer Performance Index and Internal Process Index were all relevant to the Short-term Debts Ratio.(3) Reject the null hypothesis of "Long-term Debts Ratio not affected by operating performances". To be more specific, Financial Performance Index, Innovation and Learning Performance Index and Internal Process Index were all relevant to the Long-term Debts Ratio, While Customer Performance Index was not.(4) Reject the null hypothesis of "Debts Ratio not affected by operating performances". To be more specific, Financial Performance Index, Innovation and Learning Performance Index, Customer Performance Index and Internal Process Index were all relevant to the Debts Ratio. Besides, after using Balanced-Scorecard, the adjusted R2 of regression model was better than that only consisted of financial measurement index. This result shows that, adopting the performance index of Balanced-Scorecard to perform this study will truly improve the explanation ability, thus providing a better method than the traditional way.