The Effect of Inventory Management Efficiency and Trade Credit on the Capital Structure Stability

Journal of Asset Management and Financing

Hassan Zalaghi¹  Reza Maddadian Moez²  Mojtaba Kamareh Gereh³ 

[1] Assistant Professor, Department of Accounting, Faculty off Economics & Social Sciences, Bu-Ali Sina University, Hamedan, Iran;MA Student, Department of Accounting, Faculty off Economics & Social Sciences, Bu-Ali Sina University, Hamedan, Iran;MA, Department of Accounting, Faculty off Economics & Social Sciences, Bu-Ali Sina University, Hamedan, Iran;

关键词: trade credit;    market leverage;    book leverage;    capital structure stability;    inventory management;   

DOI  :  10.22108/amf.2020.124051.1559

来源: DOAJ

【 摘 要 】

One of the most important financial and managerial decisions of companies is determining the optimal amount of inventory needed for each period. The inventory of goods and commercial credit can be considered as one of the important items in supply chain management and as a source of short-term finance, respectively, which can be of great benefit to organizations if they are managed prudently. We investigated the effect of product inventory management and commercial credit on the stability of capital structure by using a dynamic combined data method with a generalized torque approach in 101 firms, listed in the Tehran Stock Exchange between 2006 and 2019. The results indicate that with increasing efficiency of inventory management, the stability of capital structure decreases based on the book and market leverage. In addition, based on the book leverage, when business credit goes up, the stability of the capital structure decreases, and based on the market leverage, with the increase of commercial credit, the stability of the capital structure reduces.

【 授权许可】

Unknown