The Effect of Debt to Equity Ratio and Total Asset Turnover on Financial Distress

Abstract

This study aims to examine the effect of Debt to Equity Ratio and Total Assets Turnover on financial distress. The population in this study consists of infrastructure sector companies listed on the Indonesia Stock Exchange over a five-year period (2020–2024). The data used in this study are secondary data in the form of financial statements of infrastructure companies from 2020 to 2024, obtained from the official website of the Indonesia Stock Exchange and the companies’ official websites. The sample was selected using a purposive sampling method, resulting in 40 companies that met the criteria. The data analysis method used is binary logistic regression with the assistance of IBM SPSS Statistics 25 software. The results of the study indicate that the Debt to Equity Ratio variable has a significant effect on financial distress, while Total Assets Turnover has no effect on financial distress.