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Financial Management and Profitability Analysis

The document presents statistical analyses including Pearson Correlation, Analysis of Variance (ANOVA), and Multiple Regression to examine the relationship between Financial Management Practices (FMP) and Profitability. It concludes that there is a significant correlation between FMP and profitability, and various hypotheses regarding differences in means and interactions among business nature, years of operation, and financial management practices are tested. The results indicate significant differences and relationships, particularly in small and micro enterprises.

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Jerome Aligan
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0% found this document useful (0 votes)
3 views28 pages

Financial Management and Profitability Analysis

The document presents statistical analyses including Pearson Correlation, Analysis of Variance (ANOVA), and Multiple Regression to examine the relationship between Financial Management Practices (FMP) and Profitability. It concludes that there is a significant correlation between FMP and profitability, and various hypotheses regarding differences in means and interactions among business nature, years of operation, and financial management practices are tested. The results indicate significant differences and relationships, particularly in small and micro enterprises.

Uploaded by

Jerome Aligan
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Statistical

Test
Pearson Correlation
Analysis of Variance
Multiple Regression
 NoB = Nature of Business
YoO = Years of Operation
FMP = Financial Management Practice
Pearson Correlation
 Ho: There is no significant relationship between the Financial
Management Practices and Profitability.
 Ha: There is a significant relationship between the Financial
Management Practices and Profitability.
Pearson Correlation
Correlations
FMP Profit
FMP Pearson 1 .264**
Correlation
Sig. (2-tailed) .002

N 137 137
Profit Pearson .264** 1
Correlation
Sig. (2-tailed) .002

N 137 137
**. Correlation is significant at the 0.01 level (2-tailed).

There’s a significant relationship between Financial


Management and Profitability
Analysis of Variance
 Ho1: There's no significant Difference between means of Nature of Business
 Ho2: There's no significant Difference between means of Years Operating
 Ho3: There's no significant Difference between means of Financial Management Practices
 Ho4: There's no interaction between Nature of Business and Years Operating
 Ho5: There's no interaction between Nature of Business and Financial Magement Practices

 Ho6: There's no interaction between Years Operation and Financial Management Practices
 Ho7: There's no interaction between Nature of Business and Years Operating and Financial
Management Practices

 p < a=.05 = Ho is rejected


 p > a=.05 = fail to reject Ho
Analysis of Variance
 Ha1: There’s a significant Difference between means of Nature of Business.
 Ha2: There’s a significant Difference between means of Years Operating.
 Ha3: There’s a significant Difference between means of Financial Management Practices.
 Ha4: There’s an interaction between Nature of Business and Years Operating.
 Ha5: There’s an interaction between Nature of Business and Financial Magement
Practices.
 Ha6: There’s an interaction between Years Operation and Financial Management
Practices.
 Ha7: There’s an interaction between Nature of Business, Years Operating, and Financial
Management Practices.
Analysis of Variance
(Small Enterprise)
Analysis of Variance
Ha: There’s no equal variance(Small Enterprise)
Ho: There’s an equal variance

Levene's Test of Equality of Error Variances a,b

Levene Statistic df1 df2 Sig.

Profit Based on Mean 1.589 17 43 .110

Based on Median .916 17 43 .561

Based on Median and with .916 17 19.640 .569


adjusted df

Based on trimmed mean 1.522 17 43 .132

Tests the null hypothesis that the error variance of the dependent variable is equal across groups.

a. Dependent variable: Profit

b. Design: Intercept + NoB + YoO + FMP + NoB * YoO + NoB * FMP + YoO * FMP + NoB * YoO * FMP
Analysis of Variance
(Small Enterprise)
 Ho1: There's no significant Difference between means of Nature of
Business
 - THERE’S A SIGNIFICANT DIFF. BETWEEN MEANS OF NOB
 Ho2: There's no significant Difference between means of Years
Operating
 - THERE’S A SIGNIFICANT DIFF. BETWEEN MEANS OF NOB
 Ho3: There's no significant Difference between means of Financial
Management Practices
 Ho4: There's no interaction between Nature of Business and Years
Operating
 Ho5: There's no interaction between Nature of Business and Financial
Magement Practices
 Ho6: There's no interaction between Years Operation and Financial
Management Practices
 Ho7: There's no interaction between Nature of Business and Years
Operating and Financial Management Practices

 p < a=.05 = Ho is rejected


 p > a=.05 = fail to reject Ho
Analysis of Variance
(Small Enterprise)
Analysis of Variance
(Small Enterprise)
Analysis of Variance
(Small Enterprise)
Analysis of Variance
(Micro)
 Ho1: There's no significant Difference between means of Nature of Business
 Ho2: There's no significant Difference between means of Years Operating
 Ho3: There's no significant Difference between means of Financial Management Practices
 Ho4: There's no interaction between Nature of Business and Years Operating
 Ho5: There's no interaction between Nature of Business and Financial Magement Practices

 Ho6: There's no interaction between Years Operation and Financial Management Practices
 Ho7: There's no interaction between Nature of Business and Years Operating and Financial
Management Practices

 p < a = Ho is rejected
 p > a = fail to reject Ho
Analysis of Variance
(Micro)
 Ha1: There’s a significant Difference between means of Nature of Business.
 Ha2: There’s a significant Difference between means of Years Operating.
 Ha3: There’s a significant Difference between means of Financial Management Practices.
 Ha4: There’s an interaction between Nature of Business and Years Operating.
 Ha5: There’s an interaction between Nature of Business and Financial Magement
Practices.
 Ha6: There’s an interaction between Years Operation and Financial Management
Practices.
 Ha7: There’s an interaction between Nature of Business, Years Operating, and Financial
Management Practices.
Analysis of Variance
(Micro)
Analysis of Variance
(Micro)
Levene's Test of Equality of Error Variances a,b

Levene Statistic df1 df2 Sig.

Profit Based on Mean 1.589 17 43 .110

Based on Median .916 17 43 .561

Based on Median and with .916 17 19.640 .569


adjusted df

Based on trimmed mean 1.522 17 43 .132

Tests the null hypothesis that the error variance of the dependent variable is equal across groups.

a. Dependent variable: Profit

b. Design: Intercept + NoB + YoO + FMP + NoB * YoO + NoB * FMP + YoO * FMP + NoB * YoO * FMP
Analysis of Variance
(Micro)
Analysis of Variance
(Micro)
Analysis of Variance
(Micro)
Analysis of Variance
(Micro)
Multiple Regression (Small
Enterprise)
Ho: There's no Significant Relationship Between Financial Management Practices and Profitability
Ha: There's a Significant relationship Between Financial Management Practices and Profitability
Multiple Regression (Small
Enterprise)
Model Summary

Std. Error of the


Model R R Square Adjusted R Square Estimate

1 .654a .427 .419 23946.01438

a. Predictors: (Constant), FMP


Multiple Regression (Small
ANOVAa
Enterprise)
Model Sum of Squares df Mean Square F Sig.

1 Regression 29095613154.847 1 29095613154.847 50.741 <.001b

Residual 38991989120.653 68 573411604.715

Total 68087602275.500 69

a. Dependent Variable: Profit

b. Predictors: (Constant), FMP

Coefficientsa

Standardized
Unstandardized Coefficients Coefficients

Model B Std. Error Beta t Sig.

1 (Constant) 22581.076 7210.054 3.132 .003

FMP 17645.774 2477.195 .654 7.123 <.001

a. Dependent Variable: Profit


Multiple Regression (Micro)

Ho: There's no Significant Relationship Between Financial Management Practices and Profitability
Ha: There's a Significant relationship Between Financial Management Practices and Profitability
Multiple Regression (Micro)

Ho: There's no Significant Relationship Between Financial Management Practices and Profitability
Ha: There's a Significant relationship Between Financial Management Practices and Profitability
Multiple Regression (Small
Enterprise)
Multiple Regression (Macro)
Thank you!

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