请问这里Total asset如何调整？

问题如下：

Question

The following information was taken from the financial statements and notes to the financial statements of a company that accounts for its inventory using the LIFO method:

If the company had reported on a FIFO basis, and the additional tax liability arising from restatement resulted in a deferred liability, its 2014 return on assets (using 2014 assets only) would be closest to:

选项：

A.6.1%.

B.6.4%.

C.7.7%.

解释：

Solution

A is correct.

Return on assets = Net income/Total assets

= 391.4/6,437

= 6.08%

Under FIFO, total assets increase by the LIFO reserve but decrease by the cash paid for the cumulative amount of additional income taxes that would arise. Net income will be higher under FIFO due to lower COGS (i.e., the increase in the LIFO reserve) but will be reduced by the taxes paid on the increase in operating profit.

B is incorrect. It assumes the cumulative taxes would have been paid and resulted in a cash outflow thus reducing total assets. Taxes paid on higher cumulative profits = 33.3% × 867 = 288.7

ROA = 391.4/[5,570 + 867 – 106.6] × 100 = 391.4/6,148 × 100 = 6.37%

C is incorrect. It ignores tax effects but adjusts pre-tax income and inventory properly:

ROA = [178 + 320]/[5,570 + 867] × 100 = 498/6,437 × 100 = 7.7%