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Full-Text Articles in Business
Relationship Between Assets, Liabilities, Earnings Before Interest And Taxes, And Financial Distress, Joseph A. Baker
Relationship Between Assets, Liabilities, Earnings Before Interest And Taxes, And Financial Distress, Joseph A. Baker
Walden Dissertations and Doctoral Studies
Retail sector investors who do not interpret Altman's Z´´-score accurately can underestimate a company's economic viability and ability to secure debt and equity financing. Grounded in agency theory, the purpose of this quantitative correlational study was to examine the relationship between assets, liabilities, earnings before interest and taxes (EBIT), and financial distress. The data were based on financial statements from 101 U.S. public retail sector companies (U.S. Securities and Exchange Commission Standard Industrial Codes 5200 through 5990). Multiple linear regression (MLR) analysis indicated a statistically significant relationship between assets, liabilities, EBIT, and Altman's Z´´-score for financial statements prepared under ASC …