EFFECT OF CAPITAL STRUCTURE ON THE LIQUIDITY OF QUOTED CONSUMER GOODS FIRMS IN NIGERIA
2nd Biennial Conference
Authors
Abstract
The study investigated the effect of capital structure on the liquidity position of quoted consumer goods firms in
Nigeria. Data was collected from audited annual report of quoted consumer goods firm in Nigeria Stock
Exchange and the data was analyzed using both descriptive and inferential statistics. The result of this study
revealed a negative relationship between total debt to equity ratio and current ratio of selected consumer goods
companies but statistically significant at 5%. Long term debt ratio also has negative and statistical significant
relationship with the liquidity position of quoted consumer goods firms in Nigeria while debts to equity ratio was
found to be negatively and significantly related with the liquidity position of quoted consumer goods firms in
Nigeria. The study recommends that consumer goods firms quoted on NSE should adopt a better and more
profitable capital structure and implement better strategy to source for the firm and reduce the rate at which the
fund comes from external source especially creditors and bank or any financial institution.
Keywords
Capital Structure, Liquidity Position, Consumer Goods Firm, Equity Capital Ratio and Long Term Debts Ratio
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