2.3 of stock out thus, the firm size has


To the present literature, there is no specific
definition of firm size. The use of size by theory was the number of employees,
total assets, sales or marketing capitalization. On the other hand, the concept
of firm size has been used for variety theoretical constructs ranging from risk
to liquidity (Ball and Foster, 1982).

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In recent years, there has been an increasing amount
of literature on effects of firm size to the performances of a firms  (e.g., Tovar, Javier
Ramos-Real, & de Almeida, 2011) states that the size of a firm is crucial for
industry’s productivity . This is because, the firms size determines the
development of the productivity via the scale impact.

(Offenberg, 2009) found that, the amount of dollar is the faster
measures of a firm size. He stated that, the variance of sales increased where
for the largest firms are larger and those small firm are small. This has been
argued by Bourlakis, Maglaras,
Aktas, Gallear, & Fotopoulos, (2014) in their studies where they found that, small firm
are likely increased their profit because small firms can easily build a strong
relationship with their customer. According to their research, this is due to
the distribution of raw material (assets) in the small firm. Besides that,
small firms see to perform well in their number of employees where they
maximize their employees sources in the productions. Hence, small firms perform
better in their market capitalization which makes these firm more profitable.
Hence, the proportion of earing per share will be determined from the profit

Aboody, Barth, & Kasznik, (1999) stated that, the current values of assets is important to
the users of financial statement. The reflection of asset value will provide a
better insight for firm performances either it has a higher or lower EPS
distribution. On the other hands, the firm with large inventory may lead to
higher sales. Larger inventory prevent the risk of stock out thus, the firm
size has a positive relationship with the earning per share.


Tangible asset is an
assets that can be seen, touched and reproduced. Hence, it is easier to price
and determining the firm value (Tangible Assets, n.d) as tangible assets
considered as one of major determinant in firm’s performances in term of
earning per share (Omowunmi, 1983).

Vo (2017) reviewed the
literature from the period and found a claims that, both agency theory and
trade–off theory suggested the importance of tangible assets in determining the
capital structures of a firm.

Fernandes (2011) found that, the more tangible
assets owned by firm the lower risk faced by the lender. Hence, the firm will
generates more profit due to the less financial constraint faced by those
firms. In accordance to that, the earning per share will be influenced from the
assets and profit maximization (Kim, 2017).

Prior studies by Aboody, Barth, & Kasznik, (1999) indicates that, the revaluations of fixed asset has
significant relationship with operating performances in correlation with the
earning per share. A research about the fixed assets in UK firms indicates
that, the changes in operating income for the time series characteristic of
earning can affect the future operating income.

In summary, the firm with more tangible asset are
more likely better to raise finance and therefore a positive relationship
between tangible asset and earning per share is expected.