THE IMPACT OF FREE CASH FLOWudAND LIFE CYCLE THEORYudTO DIVIDEND POLICYud(Empirical Study On Manufacturing Company Listed In Indonesia StockudExchange Period 2008-2011)ud

摘要

Dividend policy is a policy that relates to dividend payment by company, that is how much dividend will be distributed and retained earnings for company’s interest (Levy and Sarnat, 1990). Dividend policy determined by The General Meeting of Shareholder will affect the amount of cash distributed as dividends. This is called the dividend payout ratio (DPR). The amount of dividend payout ratio (DPR) also based on various factors such as free cash flow and company’s life cycle. This research aims to test the impact of free cash flow and life cycle theory to dividend policy. The dependent variable in this research is dividend policy proxied by dividend payout ratio (DPR). The independent variable in this research free cash flow proxied by FCF/TA and company’s life cycle proxied by RE/TE. Result show that independent variable free cash flow and company’s life cycle positively impact dividend policy.