1. We will examine the debt ratios for two airlines. First go to finance.yahoo.com. In the “Quote Lookup” box, enter “LUV” for Southwest Airlines. Select South-west Airlines. Click on “Financials” and scroll down and select “Balance Sheet.”
2. Compute the ratio of long-term debt to total stockholders’ equity for the three years shown. Do the same thing for total liabilities to total stockholders’ equity.
3. Go back to the “Quote Lookup” box and follow the same process for Delta Air Lines (DAL). Write a paragraph summary of the two airlines’ debt ratios. Which company is in better condition?