Table 2.

Variables description

Variable typeVariable nameSymbolProxy measureEvidence from prior studies
Dependent variableLeverageLEV“It is measured by dividing the total liabilities upon total assets”Güner (2016), Yildirim et al. (2018) 
Independent variablesReturn on equityROE“ROE is calculated by profit after tax divided total equity shares at the end of the year”Al-ahdal et al. (2020), Rouf (2015) 
Tobin-QTQ“Tobin’s Q can calculate by the ratio of the market capitalization plus total debt divided by total asset of the company”Al-ahdal et al. (2020), Yameen et al. (2019) 
LiquidityLIQ“Current assets divided by current liabilities”Güner (2016), Rouf (2015) 
Return on capital employedROCE“It is calculated by comparing net profit after tax with capital employed”Al-Matari et al. (2014), Yameen et al. (2019) 
Return on assetsROA“It is measured by the percentage of the net profit of one year for the total assets of the same year”Almaqtari et al. (2019), Rouf (2015) 
Firm sizeFSIZE“The natural logarithm of total assets”Matemilola et al. (2013), Yildirim et al. (2018) 
Market value addedMVA“It can be calculated by the difference between the market value and book value of equity”Al-Matari et al. (2014), Imberman and Lovenheim (2016) 

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