• NIMAN IBRAHIN ARAB
• Dr Rajinder Kaur

The purpose of this study is to examine the impact of working capital management on firms’ profitability. The study aim to examine the statistical significance between food companies’ working capital management and profitability. Based on this objective the study adopted quantitative method of research approaches to check a series research hypothesis. Accordingly, the study selected a sample of sixteen (16) food manufacture companies in Ethiopia for the period of ten years (2007-2016) with the total of 160 observations. Data was analyzed on quantitative basis using Pearson’s correlation and panel data regression analysis. The outcomes showed that there is statistical significance negative relationship between profitability and working capital management. It means that, firm’s managers can create profits or value for their companies and shareholders by keeping average collection period and inventory conversion period of working capital to a possible optimum level. The researchers found that there is a significant negative relationship between liquidity and profitability. Furthermore the study finds that there is strongly significance positive relationship between size and firm profitability. Unlike, the study found that there is no statistically significance negative relationship between debt used and firms profitability.

working capital, working capital management, firm size, debt ratio, and profitability.

"Impact of Working Capital on Firms Profitability: an Evidence From Food Manufacture Companies in Ethiopia .", International Journal of Emerging Technologies and Innovative Research (www.jetir.org), ISSN:2349-5162, Vol.5, Issue 12, page no.88-102, December-2018, Available :http://www.jetir.org/papers/JETIR1812B15.pdf

"Impact of Working Capital on Firms Profitability: an Evidence From Food Manufacture Companies in Ethiopia .", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.5, Issue 12, page no. pp88-102, December-2018, Available at : http://www.jetir.org/papers/JETIR1812B15.pdf