NWC, Current assets, Current liabilities, Sales, cash, Marketable securities, Average of total assets, total assets, total

current assets, total current liabilities,

Liquidity 10 item ( NWC, Current assets, Current liabilities, Sales, Cash, Marketable securities, Average of total assets, Total assets, Total current assets, Total current liabilities) 1. net working capital/total assets (Stevens 1973) 2. net working capital/sales (Stevens 1973) 3. Liquid assets a. (cash plus marketable securities less current liabilities) to total assets (Cudd and Duggal 2000). 4. assets turnover = sales /average of total assets(Soegiharto 2010). 5. Current Ratio a. Computed as total current assets divided by total current liabilities (Dickmann 2010) b. Current Asset/Current Liabilities (Belkaoui 1978) 6. Current Asset/Total Assets (Belkaoui 1978) 7. Cash/Total Assets (Belkaoui 1978) 8. Cash/Current Liabilities (Belkaoui 1978) Profitability 15 item (EBIT, EBT, Total assets, Sales, Net income, Net stockholder equity, Profit after tax, Net sales, Gross profit, Profit before interest and tax, Profit before depreciation interest and tax, Operating expense, Cost of goods sold, Selling general and administratif expense) 1. EBIT/total assets (Stevens 1973) 2. EBIT/sales (Stevens 1973) 3. EBT/sales (Stevens 1973) 4. net income/sales (Stevens 1973) 5. net income/net stockholders equity (Stevens 1973) 6. net income/total assets (Stevens 1973) 7. Net Profit Margin = (PAT / Net Sales) (Mantravadi and Reddy 2008) 8. gross profit/sales (Stevens 1973) 9. Gross Profit Margin= (PBIT / Net Sales), (Mantravadi and Reddy 2008) 10. Operating Profit Margin a. (PBDIT/ Net Sales) (Mantravadi and Reddy 2008) 11. OEA (operating expense assets)= operating expense/total assets (Paliwal 2008) a. Operating performance in terms of operating expenses (captures both cost inefficiency and excessive perquisite consumption by managers)(Paliwal 2008) b. operating expenses i. Cost of goods sold + selling general and administratif expense (Paliwal 2008) 12. OES( operating expenses sales)= operating expense/net sales (Paliwal 2008)

Leverage 12 item (Book value of total debt, Book value of total assets, Non-current liabilities, Total debt, Total assets, Long-term debt, Total equity, Market value equity, Net stockholders equity, LT liabilities, Total liabilities, The book value of total liabilities)

1. the book value of total debt over the book value of total assets of the bidder (Donker and Zahir) 2. Non-current Liabilities/Total Assets (Jackling and Johl 2009) 3. total debt / book value of total assets.(Jong et al. 2007) 4. total debt/total assets (Paliwal 2008) 5. long-term debt/total equity (Cudd and Duggal 2000). a. The leverage variable(LEV) is the average of the leverage ratios for the three years prior to when the observation is drawn 6. long-term (LT) debt/market value equity (Stevens 1973) 7. LT debt/total assets (Stevens 1973) 8. LT debt/net stockholders equity (Stevens 1973) 9. LT liabilities/total assets (Stevens 1973) 10. total liabilities/total assets (Stevens 1973) 11. The book value of total liabilities / the market value of equity (LEV) (Chaney et al. 1991) 12. the book value of total debt over the book value of total assets of the bidder (Donker) 13. D/E ratio = long-term debt / common equity.(Dickmann 2010) a. Debt Equity Ratio = (Book value of Debt / Book value of Equity) (Mantravadi and Reddy 2008) b. Debt to Equity Ratio= is equal to a companys total long-term liabilities / the shareholders equity (Donker) Activity 9 item (CGS, Inventory, Sales, Current assets, Cash, Cash equivalent, Total assets, Capital expenditure, Working Capital) 1. cost of goods sold/inventory (Stevens 1973) 2. sales/(current assets - inventory) (Stevens 1973) 3. CEA = cash and equivalent / total assets (Paliwal 2008) 4. CAPEXA= capital expenditure/total assets (Paliwal 2008) 5. Asset turnover ratio= sales/total assets (Paliwal 2008) (Stevens 1973) 6. Current Asset/Sales (Belkaoui 1978) 7. Working Capital/Sales (Belkaoui 1978) 8. Cash/Sales (Belkaoui 1978) Other 3 item (share price, Earnings, book value of total assets) 1. price/earnings (Stevens 1973) 2. Firm size variable = the book value of total assets (Cudd and Duggal 2000) **NOTE: The distinction between LT debt and LT liabilities was that LT debt included only long-term bonds and similar obligations whereas LT liabilities included all entries of a long-term nature. Market-to-book value (MTB) 8 item (Market value, Common equity, Total market capitalization, Book value of assets, Current share price, Book value per share, Market value of common equity, Book value of common equity) (Donker and Zahir) and (Soegiharto 2010) 1. the market value over the common equity of the bidder, where market value is obtained by multiplying the number of outstanding shares of bidder by its closing market price on the 21st day before the first announcement.(Donker and Zahir)

2. total market capitalization divided by the book value of assets (Dickmann 2010) 3. the current share price divided by the book value per share (Donker) 4. The ratio of the market value of common equity to the book value of common equity (Cudd and Duggal 2000) Return on assets 6 item (EBIT, Book value of total assets, Operating income, Average of total assets, Operating income after depreciationand interest but before taxes, Total assets ) (Jackling and Johl 2009) and (Donker and Zahir) (Soegiharto 2010), (Dickmann 2010) 1. earnings before interest and taxes divided by the book value of total assets of the bidder (Donker and Zahir) (Donker) 2. operating income/average of total assets(Soegiharto 2010) 3. operating profits standardized by book value of total assets (Jong et al. 2007). 4. Operating income(after depreciation and interest but before taxes)/total assets (Chaney et al. 1991) ROE 2 item (Post-tax earning, Total equity) (Post-tax earnings/ Total Equity) X 100 (Marimuthu 2008) Gearing Ratio 2 item (Long term debt, total Equity) Long term debt/ Total equity + long term debts (Marimuthu 2008) PE Ratio 4 item (Market price, EPS, Market value of equity, Total earnings) 1. Market price/ EPS (Marimuthu 2008) 2. Ratio of the firms market price per share to its earnings per share (Cudd and Duggal 2000) 3. Price/earnings variable= Market value of equity/total earnings (Chaney et al. 1991) Growth 4 item (Capital Expenditure, Sales, R&D expenditure, Annual rate of change of Net sales) 1. Capital Expenditure to Sales (Jackling and Johl 2009) 2. Research and Development Expenditure to Sales (Jackling and Johl 2009) 3. specified as the annual rate of change in the firms net sales (Cudd and Duggal 2000) for three-year period prior to when the observation is drawn 4. Sales growth= Beta coefficient of three year sales. Regressing sales over time for the three years period prior to the merger. The beta coefficient from this regression is used to proxy growth (Chaney et al. 1991) Free cash flow (Harford 1999) (Jensen 1986) (lom tau cara hitungnya) Control variables 3 item (Current Assets, Fixed assets, Total assets log) Total Asset 1. Current Asset + Fixed Asset.(Marimuthu 2008) The size variable 1. Log of total assets (Chaney et al. 1991)