Lodestar, Inc., and Cosmos, Inc., are competing companies with similar backgrounds. The stock of both companies is traded locally, and each stock can be purchased at its book value. Mary Link has an opportunity to invest in either company but is undecided as to which is the better managed company and which is the better investment. Prepare a report to Ms. Link stating which company you think is the better managed and which company's stock you think may be the better investment. Back your report with any ratios, turnovers, and other analyses you think pertinent.

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Accounts receivable. Merchandise inventory. Total assets Common stock Retained earnings. December 31, 1989, Data Lodestar, Inc. $125,400 Cosmos, Inc. $170,400 119,000 137,200 700,600 662,400 272,000 239,000 177,300 190,600