4. Pronto, Inc. is a major producer of printing equipment. Pronto uses a LIFO cost-flow assumption for inventories. The company's tax rate is 35%. Below is selected financial data for the company. Pronto, Inc. Selected Financial Data December 31, 2013 2012 2011 (amounts in thousands) Inventories (LIFO) $ 48,454 $ 42,369 $ 45,388 Total Assets 395,685 384,545 378,122 Common Shareholders Equity 102,754 98,564 89,455 Sales $546,258 $488,965 Cost of Goods Sold 393,857 348,920 Interest Expense 14,253 15,689 Net Income 24,581 21,025

Required: a. The excess of FIFO over LIFO inventories was $25 million on December 31, 2013, $28.5 million on December 31, 2012 and $22 million on December 31, 2011. Compute the cost of goods sold for Pronto, Inc. for years 2013 and 2012 assuming that it had used a FIFO assumption.

b. Compute the inventory turnover ratio for Pronto, Inc. for years 2013 and 2012 using a LIFO cost-flow assumption.

c. Compute the inventory turnover ratio for Pronto, Inc. for years 2013 and 2012 using a FIFO cost-flow assumption.

d. Compute the rate of return on assets for years 2013 and 2012 based on the reported amounts. Disaggregate ROA into profit margin and asset turnover components.

e. Compute the rate of return on assets for years 2013 and 2012 assuming that Pronto, Inc. had used the FIFO method of accounting for inventories. Disaggregate ROA into profit margin and asset turnover components.