Chapter 1, Problem 18QA

Debt Management and Short-Term Liquidity Ratios Magellan Company is an international travel agency providing travel planning services to customers in over 20 Countries. Recently, the travel industry has been experiencing volatility as a result of increases in oil prices. Magellans investors have been following its financial information closely to determine its ability to continue as a going concern, Its investors have used the following information to determine financial ratios: Required: Between 20l8 and 20l9, indicate whether Magellans debt to equity ratio increased or decreased. Also, indicate whether Magellans current ratio increased or decreased. Interpret these ratios.