Table 8.

Selection of the research variables.

Variable classification	Variable code	Variable description and computation
Financial variables	X1	Accounts receivables/total assets
	X2	Gross profit/total assets
	X3	Inventory/current assets
	X4	Inventory/total assets
	X5	Net profit after tax/total assets
	X6	Net profit after tax/fixed assets
	X7	Cash/total assets
	X8	Log total assets
	X9	Log total liabilities
	X10	Interest protection multiples (debt service coverage ratio, times interest earned)
	X11	Gross profit margin
	X12	Operating expense ratio
	X13	Debt ratio
	X14	Inventory turnover
	X15	Cash flow ratio
	X16	Net profit ratio before tax
	X17	Accounts payable turnover
	X18	Revenue growth rate
	X19	Debt/equity ratio
	X20	Earnings before interest, taxes, depreciation, and amortization
	X21	Current liabilities/total assets
	X22	Total assets turnover
	X23	Account receivable/last year accounts receivable >1.1
	X24	Operation profit/last year operation profit >1.1
Nonfinancial variables	X25	Shareholding ratio of the major shareholders
	X26	Shareholding ratio of directors and supervisors
	X27	Whether the chairman concurrently holds the position of CEO
	X28	Board size
	X29	Pledge ratio of shares of the directors and supervisors