International Research Journal of Management, IT & Social Sciences Available online at https://sloap.org/journals/index.php/irjmis/ Vol. 6 No. 5, September 2019, pages: 101~107 ISSN: 2395-7492 https://doi.org/10.21744/irjmis.v6n5.704 101 The Pecking Order Theory Testing on Company Life Cycle Ida Ayu Kayika Apsari a Ni Ketut Rasmini b Article history: Abstract Received: 27 March 2019 Accepted: 31 May 2019 Published: 23 August 2019 This study was conducted on 49 property and real estate companies listed on the Indonesia Stock Exchange. Year of observation in this research is the year 2013-2017. Research samples of 49 property and real estate companies are grouped based on their life cycle criteria based on the company's net sales for 5 years. After the company is grouped based on its life cycle, multiple linear regression tests are used to test whether the company's Life Cycle affects the company in applying Pecking Order Theory in its funding decision. After multiple linear regression tests, the company in the Growth and Mature cycle stages is compared to whether firm growth is stronger than mature in applying Pecking Order Theory. The results of this study obtained Life Cycle property and real estate companies listed on the Stock Exchange did not significantly affect the Pecking Order Theory. The life cycle of the company does not affect the company in determining its funding decision. The life cycle of the company does not affect the company to apply the Pecking Order Theory in determining its capital structure. Companies that have been grouped according to their life cycle, in determining their capital structure, whether the company will fund with internal funds or external funds company, not based on the life cycle of the company. Keywords: company; growth; life cycle; mature; pecking order theory; 2395-7492© Copyright 2019. The Author. This is an open-access article under the CC BY-SA license (https://creativecommons.org/licenses/by-sa/4.0/) All rights reserved. Author correspondence: Ida Ayu Kayika Apsari, Faculty of Economic and Business Udayana University, Denpasar, Indonesia. Email address: kayikaapsari@gmail.com 1. Introduction Company capital as a fulfillment of funds to carry out operational activities can be sourced from internal and external funds. Internal capital sources are sources that originate from business activities in the form of retained earnings, but internal capital is very limited, so additional capital is needed from third parties to support business activities. External funding sources are sources of funds obtained from external parties or third parties in the form of debt and other funds obtained from suppliers, banks and capital markets (Sukardi, 2009). a Udayana University, Denpasar, Indonesia b Udayana University, Denpasar, Indonesia