Impact of stock valuation on profitability of manufacturing industry

Impact of stock valuation on profitability of manufacturing industry

Author by Dr. Tunji Siyanbola

Journal/Publisher: International Journal Of Advanced Research In Management And Social Sciences

Volume/Edition: 1

Language: English

Pages: 35 - 46

Abstract

This study was carried out to ascertain the effect of stock valuation on profitability of manufacturing industries. A survey research design was adopted in which twenty five workers of a typical manufacturing company were used and data were collected using questionnaire. Three research hypotheses were raised and tested; while the demographic information of the respondents were analysed using simple percentage, the hypotheses were tested using t-test statistic at a significant level of 5%. The testing of the hypotheses revealed that:
? Proper checking of good purchased to ensure conformity with purchase order in terms of quality, quantity, price and description is important even though the suppliers are known;
? High stock cost affects profit negatively;
? Stock out will affect the company’s profit.
Based on the findings it was recommended that effective stock valuation and control should be emphasised by all manufacturing companies to ensure profit maximisation at all time so as to be able to satisfy the stakeholders.


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