The paper is an attempt to show the relationship between working capital and the profitability function of pharmaceutical industry in Bangladesh. Working capital management as a financial strategy has its effects on liquidity as well as profitability of the firm. To serve the study mostly secondary data have been used of pharmaceutical companies listed in DSE & CSE and data include time series from annual reports of the selected companies. Sample size includes10 selected pharmaceutical companies and their five years annual data. Multiple regression and correlation have been used to analyze the data. To serve the study perspective, this paper considered the working capital indicators such as (Account Receivable Turnover in days, Account payable Turnover in days, Inventory Turnover in days and Cash conversion cycle) as independent variable where as Profitability indicator (Return on Assets) as dependent variable and found there is a significant relationship between the variables studied. Finally the study shows the rejection of Null hypotheses (H0) which mentions that there is significant effect of working capital on firm’s profitability. The inference drawn from the study would be able to provide the basis for rethinking the practices of working capital management for competitive survival.
| Published in | Journal of Finance and Accounting (Volume 6, Issue 1) |
| DOI | 10.11648/j.jfa.20180601.11 |
| Page(s) | 1-10 |
| Creative Commons |
This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited. |
| Copyright |
Copyright © The Author(s), 2018. Published by Science Publishing Group |
Working Capital Management, Profitability, DSE, CSE, Conversion Cycle, Hypotheses
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APA Style
Md. Amir Sharif, Md. Rafiul Islam. (2018). Working Capital Management a Measurement Tool for Profitability: A Study on Pharmaceutical Industry in Bangladesh. Journal of Finance and Accounting, 6(1), 1-10. https://doi.org/10.11648/j.jfa.20180601.11
ACS Style
Md. Amir Sharif; Md. Rafiul Islam. Working Capital Management a Measurement Tool for Profitability: A Study on Pharmaceutical Industry in Bangladesh. J. Finance Account. 2018, 6(1), 1-10. doi: 10.11648/j.jfa.20180601.11
AMA Style
Md. Amir Sharif, Md. Rafiul Islam. Working Capital Management a Measurement Tool for Profitability: A Study on Pharmaceutical Industry in Bangladesh. J Finance Account. 2018;6(1):1-10. doi: 10.11648/j.jfa.20180601.11
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Download@article{10.11648/j.jfa.20180601.11,
author = {Md. Amir Sharif and Md. Rafiul Islam},
title = {Working Capital Management a Measurement Tool for Profitability: A Study on Pharmaceutical Industry in Bangladesh},
journal = {Journal of Finance and Accounting},
volume = {6},
number = {1},
pages = {1-10},
doi = {10.11648/j.jfa.20180601.11},
url = {https://doi.org/10.11648/j.jfa.20180601.11},
eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20180601.11},
abstract = {The paper is an attempt to show the relationship between working capital and the profitability function of pharmaceutical industry in Bangladesh. Working capital management as a financial strategy has its effects on liquidity as well as profitability of the firm. To serve the study mostly secondary data have been used of pharmaceutical companies listed in DSE & CSE and data include time series from annual reports of the selected companies. Sample size includes10 selected pharmaceutical companies and their five years annual data. Multiple regression and correlation have been used to analyze the data. To serve the study perspective, this paper considered the working capital indicators such as (Account Receivable Turnover in days, Account payable Turnover in days, Inventory Turnover in days and Cash conversion cycle) as independent variable where as Profitability indicator (Return on Assets) as dependent variable and found there is a significant relationship between the variables studied. Finally the study shows the rejection of Null hypotheses (H0) which mentions that there is significant effect of working capital on firm’s profitability. The inference drawn from the study would be able to provide the basis for rethinking the practices of working capital management for competitive survival.},
year = {2018}
}
TY - JOUR T1 - Working Capital Management a Measurement Tool for Profitability: A Study on Pharmaceutical Industry in Bangladesh AU - Md. Amir Sharif AU - Md. Rafiul Islam Y1 - 2018/01/12 PY - 2018 N1 - https://doi.org/10.11648/j.jfa.20180601.11 DO - 10.11648/j.jfa.20180601.11 T2 - Journal of Finance and Accounting JF - Journal of Finance and Accounting JO - Journal of Finance and Accounting SP - 1 EP - 10 PB - Science Publishing Group SN - 2330-7323 UR - https://doi.org/10.11648/j.jfa.20180601.11 AB - The paper is an attempt to show the relationship between working capital and the profitability function of pharmaceutical industry in Bangladesh. Working capital management as a financial strategy has its effects on liquidity as well as profitability of the firm. To serve the study mostly secondary data have been used of pharmaceutical companies listed in DSE & CSE and data include time series from annual reports of the selected companies. Sample size includes10 selected pharmaceutical companies and their five years annual data. Multiple regression and correlation have been used to analyze the data. To serve the study perspective, this paper considered the working capital indicators such as (Account Receivable Turnover in days, Account payable Turnover in days, Inventory Turnover in days and Cash conversion cycle) as independent variable where as Profitability indicator (Return on Assets) as dependent variable and found there is a significant relationship between the variables studied. Finally the study shows the rejection of Null hypotheses (H0) which mentions that there is significant effect of working capital on firm’s profitability. The inference drawn from the study would be able to provide the basis for rethinking the practices of working capital management for competitive survival. VL - 6 IS - 1 ER -
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