Abstract
This objective of this study is to investigate the impact of firm size, asset
tangibility and retained earnings on the financial leverage. In this regard, auto
sector was taken as case consisting of sub-sectors namely motor vehicles,
trailers and auto parts. Data pertaining to 22 firms was collected from the
financial statement analysis document issued by the State Bank of Pakistan
(SBP). The multiple regression model was used to determine the relationship
between the underlying variables. The results indicated that firm size and asset
tangibility significantly affect the financial leverage. Moreover, negative
relationship was noted between the respective variables. It was found that
retained earnings have no significant impact on financial leverage.
Qadar Bakhsh Baloch, Anjum Ihsan, Shahid Jan Kakakhel, Sonia Sethi. (2015) Impact of Firm Size, Asset Tangibility and Retained Earnings on Financial Leverage: Evidence from Auto Sector, Pakistan, Abasyn Journal of Social Sciences, Volume-08, Issue-1.
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