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The Effect of Financing Structure on the Profitability of Jordanian Industrial Companies and their Dividends

Author

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  • SANA’A N, MASWADEH

    (Associate Professor, Department of Accounting, Jadara University, Irbid Jordan)

Abstract

This study investigates the effect of financing structure in achieving profits and distributing dividends, and the interactive effect between them, in order to help companies improving their profits and dividends policy. The study was carried on a population consists of the Jordanian public industrial companies. A random sample of (47) companies was selected, that having all required information for the period from 2008 to 2014, simple and multiple regression was used to test the hypotheses of the study. The main results of the study were: there is a negative effect to the liabilities (debt funds) on the income, and positive effect to the capital paid and returned earnings on the income, and the effect of the dividends on the income is more than the effect of the income on the dividends of Jordanian industrial companies, The researcher can reach to different recommendations the most prominent was Securities official bodies and authority in Jordan must increase their interest in the financial market efficiency by enabling the Jordanian industrial companies issuing new financial instruments such as preferred shares in facilitating terms, and helping companies to obtain financing sources, thus enabling these companies to take advantages of investment opportunities and reach to the idle financing structure, that maximizing the wealth of the owners and the value of the company.

Suggested Citation

  • Sana’A N, Maswadeh, 2016. "The Effect of Financing Structure on the Profitability of Jordanian Industrial Companies and their Dividends," Journal of Internet Banking and Commerce, , vol. 21(02), pages 01-18, August.
  • Handle: RePEc:ris:joibac:0168
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    More about this item

    Keywords

    Liabilities; Capital Paid; Returned Earnings; Income; Dividends;
    All these keywords.

    JEL classification:

    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists

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