<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

FORM 10-K FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTIONS 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934


(MARK ONE)

[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act
    of 1934 for the fiscal year ended DECEMBER 31, 1998 or

[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934 for the transition period from ______________ to _______________

                        COMMISSION FILE NUMBER 000-21561

                        MIAMI COMPUTER SUPPLY CORPORATION
    (Exact name of registrant as specified in its articles of incorporation)



                      OHIO                                    31-1001529
            (State of incorporation)                       (I.R.S. Employer
                                                         Identification No.)

        4750 HEMPSTEAD STATION DRIVE, DAYTON, OHIO                   45429
         (Address of principal executive offices)                 (Zip Code)

        Registrant's telephone number, including area code: 937-291-8282

        SECURITIES REGISTERED PURSUANT TO SECTION 12 (b) OF THE ACT: None

          SECURITIES REGISTERED PURSUANT TO SECTION 12 (g) OF THE ACT:

                      Common Stock, No Par Value Per Share
                               TITLE OF EACH CLASS
                               -------------------

         Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) had been subject to such
filing requirements for the past 90 days. Yes X No   .
                                             ---  ---

         Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. ____

         Aggregate market value of the voting stock held by non-affiliates of
the Registrant as of March 29, 1998: $198,437,500. The amount shown is based on
the closing price of the Registrant's Common Stock on the Nasdaq National Market
on that date. Shares of Common Stock known by the Registrant to be beneficially
owned by officers or directors of the Registrant are not included in the
computation. The Registrant, however, has made no determination that such
persons are "affiliates" within the meaning of Rule 12b-2 under the Securities
Exchange Act of 1934.

Number of shares of Common Stock outstanding at March 26, 1999:  11,627,180.

Documents incorporated by reference: Portions of the definitive proxy statement
for the Annual Meeting of Stockholders to be held May 25, 1999, are incorporated
by reference into Part III Items 10-13 hereof.

<PAGE>

                        MIAMI COMPUTER SUPPLY CORPORATION


         As used in this report, the terms "MCSC," "Company," and "Registrant"
mean Miami Computer Supply Corporation and its subsidiaries.



                                TABLE OF CONTENTS

<TABLE>

                                                           PART I                                              PAGE
                                                                                                               ----
<S>                                                                                                           <C>
Item 1.  Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    3-10
Item 2.  Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     11
Item 3.  Legal Proceedings  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     12
Item 4.  Submission of Matters to a Vote of Security Holders  . . . . . . . . . . . . . . . . . . . . . . .     12



                                                           PART II
Item 5.  Market for the Registrant's Common  Equity and Related Stockholder Matters . . . . . . . . . . . .     13
Item 6.  Selected Financial Data  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    13-14
Item 7.  Management's Discussion and Analysis of Financial Condition
              and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    14-18
Item 7A. Quantative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . . . . . .     18
Item 8.  Financial Statements and Supplementary Data  . . . . . . . . . . . . . . . . . . . . . . . . . . .    19-34
Item 9.  Changes in and Disagreements With Accountants on Accounting
             and Financial Disclosure       . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     35



                                                          PART III
Item 10. Directors  and  Executive Officers of the Registrant . . . . . . . . . . . . . . . . . . . . . . .     36
Item 11. Executive  Compensation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     36
Item 12. Security  Ownership of  Certain Beneficial Owners and Management . . . . . . . . . . . . . . . . .     36
Item 13. Certain Relationships and Related Transactions . . . . . . . . . . . . . . . . . . . . . . . . . .     36



                                                         PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K  . . . . . .  . . . . . . . . . .    36-38
  Signatures  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     39

</TABLE>


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ITEM 1.  BUSINESS

  THE COMPANY

         Miami Computer Supply Corporation, which commenced its business
operations in 1981, is a distributor of computer and office automation supplies
and accessories and audio-visual presentation products throughout the United
States, Canada and in other certain foreign countries. The Company distributes
over 1,800 different core products to approximately 50,000 middle market and
smaller companies and governmental, educational and institutional customers,
including federal, state and local governmental agencies, universities and
hospitals and, to a lesser extent, computer supply dealers primarily through its
professional sales representatives.

         The Company sells primarily nationally known, name-branded products
manufactured by approximately 500 original equipment manufacturers, including
Hewlett-Packard, Lexmark, Canon and Imation (formerly a division of 3M
Corporation) for computer supplies, and by Sharp, Epson, Proxima, Infocus and
Sony for audio-visual presentation products. The Company's products include
consumable supplies such as laser toner, copier toner, facsimile machine
supplies, ink jet cartridges, paper, printer ribbons, diskettes, computer tape
cartridges and accessories, including cleaning kits and media storage files,
computer projection presentation hardware which permits the large-scale, high
resolution projection of computer generated slides for presentation at meetings
and video conferencing hard- and software. The Company's computer supply
products are used in, or in conjunction with, a broad range of computer and
office automation products such as mainframe, mini, personal, laptop and
notebook computers, laser and ink jet printers, photocopiers, fax machines and
data storage products. The Company's audio-visual presentation products are used
singly with laptops or are part of an integrated system which is designed and
installed by the Company. The Company believes it is currently the largest
independent computer and office automation supply and audio-visual presentation
products distributor in the United States and the only company focused on
acquiring companies exclusively in this industry.

BUSINESS STRATEGY

         The Company's business strategy seeks to build on its strengths as a
sales and service oriented business to increase its market share and achieve
continued sales and earnings growth. In particular, the Company intends to
continue to implement its strategy by: (i) expanding the scope of its
operations, primarily through strategic acquisitions of computer and office
automation supply and audio-visual presentation product distribution companies
in metropolitan markets in the United States and overseas; (ii) increasing its
revenues from its existing and new customers; and (iii) recruiting experienced
sales representatives. The Company's objective is to enhance its position as a
leading distributor of computer and office automation supplies and audio-visual
presentation products, and to continue to increase net sales and net income
through effective implementation of its operating and growth strategies.

         OPERATING STRATEGIES

         PROVIDE SUPERIOR CUSTOMER SERVICE. Customer service is at the core of
the Company's operating philosophy. The Company provides its customers with high
quality service and support through: its knowledgeable and motivated sales
force, database and software capabilities that allow sales personnel real-time
access to account histories and product pricing information, accurate and
efficient delivery programs that fulfill most orders on an overnight basis, and
effective post-sale service and product return programs.

         OFFER BROAD PRODUCT SELECTION AT COMPETITIVE PRICES. The Company
distributes over 37,100 different computer and office automation supplies and
audio-visual presentation and related products at competitive price points. The
Company maintains a wide selection of name-brand products in stock to be shipped
on a same day basis and delivered overnight.

         CAPITALIZE ON INDUSTRY FOCUS. The Company has focused solely on the
computer supply and office automation and audio-visual presentation products
industry and believes it has grown to be the largest such independent company in
the industry. The Company believes its industry specialization provides an
advantage over many of the Company's competitors, who are either substantially
smaller businesses or who serve multiple or broader markets. The Company's niche
focus allows the Company to effectively evaluate industry trends and
opportunities, provide specialized customer service, establish and maintain
advantageous vendor relationships and evaluate and capitalize on acquisition
opportunities.

         DEVELOP AND MAINTAIN STRONG VENDOR RELATIONSHIPS. The Company's size
and position in the industry permit it to negotiate attractive pricing, volume
discounts and cooperative advertising from vendors. These concessions enable the
Company to maintain its gross margin and also give the Company a competitive
advantage, since such items are generally unavailable to smaller competitors.
The Company believes that continued growth will strengthen its vendor
relationships.

         INCREASE PROFITABILITY THROUGH WELL MANAGED GROWTH. Since its initial
public offering in November 1996, the Company has successfully completed sixteen
acquisitions and generated substantial internal growth while concurrently
achieving increases in 


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earnings per share. The company's success has resulted from the careful 
selection and management of acquisitions, effective selling strategies and 
effective management of operating costs.

         UTILIZE TECHNOLOGY TO IMPROVE OPERATIONS. The Company has continuously
upgraded its management information systems ("MIS") and telecommunications
systems to support its growth and expansion. The Company is installing new
financial, inventory control and distribution software which is year 2000
compliant.

         GROWTH STRATEGIES

         PURSUE COMPLEMENTARY, ACCRETIVE ACQUISITIONS. The Company believes that
the domestic and certain foreign computer supply and audio-visual presentation
markets are highly fragmented and consist primarily of relatively smaller
companies that sell within limited geographical areas. The Company believes that
a significant consolidation opportunity exists and the Company intends to
continue its aggressive program of consummating forward accretive acquisitions
with companies in this industry. (See below.)

         INCREASE SALES TO EXISTING CUSTOMERS. The Company intends to increase
sales to existing customers by emphasizing vertical marketing, cross-selling and
add-on sales in order to increase the average order size. This effort will be
supported by providing sales personnel with additional information about
customer needs, customer purchasing patterns and product pricing options at the
time of the sales call through the use of the Company's MIS.

         INCREASE REVENUES THROUGH SALES TO NEW CUSTOMERS IN EXPANDED
GEOGRAPHICAL MARKETS. The Company intends to develop relationships with new
customers in geographic locations not currently served by the Company by
increasing the size of its sales force and by providing its sales
representatives with training, support and sales leads relevant to the opening
of new customer accounts.

         With more than 18 years of experience serving the large and expanding
niche computer and office automation supply market, the Company has garnered
specific knowledge regarding the customer base, its competitors and its
suppliers. Accordingly, the Company believes that the domestic and certain
foreign computer supply and the audio-visual presentation markets are highly
fragmented and consist primarily of relatively smaller companies which typically
sell within limited geographical areas. The typical acquisition candidate of the
Company has a middle-market corporate end-user customer base in a major
metropolitan area and sales of between $5.0 and $75.0 million. Management
believes that attractive acquisition opportunities exist due to the need of
these companies to affiliate with larger organizations in order to remain
competitive. The Company's broad supplier relationships, cross-selling
opportunities, expanded products line and in-house technical support should
enable such companies to realize additional net sales and higher gross margins
after the acquisition. The Company has acquired the stock or assets of ten
regional computer and office automation supply companies, and six audio-visual
presentation products companies since its initial public offering in November
1996. The Company believes there is a significant consolidation opportunity
within the industry and, thus, intends to continue to aggressively pursue
acquisitions of other end-user computer and office automation supply and
audio-visual presentation product companies in the future. The Company has
identified potential acquisition candidates and has had preliminary discussions
with several such candidates. Except for confidentiality agreements and/or
non-binding letters of intent by and between the Company and certain other
computer supply or audio-visual presentation product distributors for the
acquisition of the assets and liabilities, or the stock, of such other
distributors which may be entered into from time to time, there are, as of the
date of this Form 10-K, no understandings, agreements or arrangements between
the Company and any other entity with respect to such an acquisition.

         Although other larger, better financed companies are currently engaged
in a rapid consolidation of the office supply industry, and to a lesser extent,
of computer supply distributors, the Company believes that it can effectively
compete for acquisitions due to its niche market strategy, its knowledge of, and
existing relationships with, many of the potential acquisition targets and its
ability to offer such targets growth potential and a management philosophy which
is clearly different from the large contract stationer consolidators. The
Company believes that it is currently the only company focusing strictly on
acquiring computer and office automation supply and audio-visual presentation
product distribution companies and that such focus offers it the ability to
increase revenues through such acquisitions at a faster rate than that of the
large consolidators. In addition, the Company believes that it will be able to
consolidate acquired companies into its business by, among other things,
retaining existing senior management and the acquired company's sales force
whenever possible, while expanding the Company's revenue base through product
cross-selling and realizing certain cost savings in inventory, communications
and shipping to achieve economies of scale.

THE COMPUTER SUPPLY AND AUDIO-VISUAL PRESENTATION PRODUCTS INDUSTRIES

         The Company estimates that the U.S. computer and office automation
supply market totaled approximately $30 billion (at retail) in 1998. Industry
sources indicate that the U.S. market for computer and office automation
supplies will grow at a compound annual rate of approximately 6 to 8% over the
next two years. The Company believes that the current size of the industry and
its potential for future growth can be attributed to: (i) the increasing
automation of the workplace as evidenced by the widespread use of personal
computers ("PCs"), printers and computer network systems, (ii) the decline in
unit prices of computer hardware and peripherals, making them more affordable to
small and medium sized businesses and individuals, (iii) the growth in business


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presentation and graphics software, which results in the use of audio-visual
presentation hardware, and (iv) the growth of high-quality printers that require
more consumable supplies than older, less sophisticated printers.

         The Company believes that advances in printing technologies will
further increase the demand for consumable computer supplies. In recent years,
printer manufacturers have lowered the prices of their printers in order to
establish a large installed base. The Company believes that the greater
availability of affordable printers will further increase the demand for
consumable computer supplies. Industry sources estimate that a printer customer
typically must spend, over the life of the printer, twice as much on consumable
goods as the cost of the printer itself.

         Industry sources estimate that the market for audio-visual presentation
products was approximately $1.2 billion in 1998 and is expected to grow at a
rate of approximately 20% over the next year. The Company believes industry
growth is currently driven by improved business presentation and graphics
software that results in increased use of audio-visual presentation hardware.
While advances in technology continue to exert downward pricing pressure on the
manufacturers who compete in this market, the audio-visual presentation products
are priced at retail in the range of $2,000 to $30,000 and currently provide for
gross margins higher than other products sold by the Company.

         The Company believes that the computer and office automation supply
segment of its business is not generally subject to the risk of rapid
technological advance and product obsolescence associated with the computer
hardware or office equipment industries. In general, the demand for computer and
office automation supplies is not dependent on new computer hardware or office
equipment sales in any particular year, but rather reflects the installed base
of equipment already in use. As a result, the consumable needs for any
particular computer or office equipment will generally continue for an extended
period of time, even after the manufacture of the particular computer or office
equipment has been discontinued. Nevertheless, the Company attempts to insulate
itself from the risk of technological obsolescence faced by original equipment
manufacturers by (i) distributing a wide range of brand-name products, (ii)
carrying primarily consumable supplies for computer or office equipment that the
Company believes has a substantial installed base, and (iii) entering into
agreements with major suppliers that allow the Company to return slow-moving
inventory. See "--Inventory Management."

         The Company believes that the role of distributors in the computer and
office automation supply and audio-visual presentation industry has increased in
importance in recent years as an increasing number of end-users find that their
need for computer supplies and audio-visual presentation products have increased
dramatically and the number of products to choose from and the issues of
compatibility of products have proliferated. The Company serves the needs of its
customers through its knowledgeable and skilled sales and customer service
personnel and timely and accurate order fulfillment.

THE COMPANY'S MARKET

         The Company believes that its primary market consists of small and
medium size businesses and, to a lesser extent, large businesses, governments
and institutions. The small business segment consists of businesses having 50 or
fewer white-collar employees which has traditionally been served by small
independent retailers located in close proximity to these customers and who
generally sell at the manufacturer's suggested list prices. More recently, this
segment has been targeted by the retail office products superstores and direct
mail order companies, seeking to increase market share by offering lower prices
and a wider product selection. The medium size business segment of this market
consists of a broad range of business and other office automation and
audio-visual presentation product users and have 50 to 500 white-collar
employees. This segment has been historically serviced by traditional contract
stationers and full-service office products distributors, and to a lesser extent
by small local retailers and direct mail order companies. The Company believes
that such companies do not provide all of the services that these small and
medium size businesses need or desire, such as customized account histories
which can tell customers about their order histories, customized billing and
customized packing and shipping and the technical expertise of a knowledgeable
sales force.

         The large business segment of the market consists of businesses,
governments and institutions having more than 500 white-collar employees which
have historically been served primarily by traditional contract stationers and
full service office products distributors. These customers, many of which
operate at multiple locations, seek competitively priced products, a high level
of value-added service including next day delivery and account relationship
management, credit terms and other information services. Although many of these
organizations have a centralized purchasing function for office and computer
supplies, the Company has found through experience, that such function does not
always serve all departments of these organizations and that certain purchasing
authority is decentralized. As a result, the Company's sales force attempts to
visit the central purchasing manager as well as the computer network manager,
the PC coordinator, the facilities manager and the office manager at the subject
organization, each of whom may have different computer supply needs and
purchasing or budgetary authority.

         The Company operates in all business segments of the computer and
office automation supply and audio-visual presentation products distribution
industry, which the Company believes generated approximately $31.2 billion in
total U.S. annual sales in 1998. Historically, the corporate computer supply and
office automation distribution segment has been populated by numerous contract


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stationers and computer supply companies, most of which operate in only one
metropolitan area and have annual sales of less than $15 million. However, as
the computer and office automation supply and audio-visual presentation product
distribution industry continues to rapidly consolidate, in large measure as a
result of the consolidation of the office products industry, the Company
believes that many small companies will be unable to effectively compete and
will stagnate, be acquired by larger companies or will be closed. Based upon
annual revenues, the Company believes that it is the largest independent
computer and office automation supply and audio-visual presentation product
distribution company in the United States.

         Unlike the computer hardware or office equipment industry, the Company
believes that the computer and office automation supply industry is not
generally subject to the risk of rapid technological advances and subsequent
product obsolescence. In general, the demand for computer supplies is not
dependent on the level or type of computer hardware or office equipment sales in
any particular year, but rather reflects the amount and type of equipment
already in use ( the "installed base"). As a result, the consumable needs for
any particular computer or office equipment will often continue for an extended
period of time, even after the manufacture of such computer or office equipment
is discontinued. Nevertheless, the Company attempts to insulate itself from the
risk of technological obsolescence faced by manufacturers by (i) distributing a
wide range of brand-name products so that the Company is not dependent upon the
success of any particular computer or office equipment manufacturer, (ii)
carrying primarily consumable supplies for computer or office equipment which
the Company believes has a substantial installed base, and (iii) entering into
agreements with major suppliers under which the Company can return slow-moving
inventory. With respect to audio-visual presentation products, the Company
insulates itself from technological obsolescence by dealing with the leading
manufacturers, obtaining the ability to return old, unsold merchandise and by
selling the manufacturer's newest models.

PRODUCTS

         The Company distributes an aggregate of over 37,100 different computer
and office automation supplies and audio-visual presentation and related
products and regularly updates its product line to reflect advances in
technology and to avoid product obsolescence. The Company's major product
categories can generally be classified as follows:

                  NON-IMPACT PRINTER SUPPLIES. Non-impact printer supplies
         include toner cartridges, ink jet cartridges, optical photo conductor
         kits, copier supplies and fax supplies. Non-impact printers, such as
         laser printers, copiers and fax machines, are rapidly growing in
         popularity and have a wide range of applications.

                  IMPACT PRINTER SUPPLIES. Impact printer supplies include
         printwheels, ribbons, elements, fonts and other consumable supplies
         used in impact printers ranging from electronic typewriters to high
         speed dot matrix printers. While new technology is moving toward
         non-impact printing, the Company believes that a substantial installed
         based of impact printers, such as dot matrix printers, are still in use
         and require a continuing amount of consumable computer supplies.

                  MAGNETIC MEDIA PRODUCTS. Magnetic media products include
         computer tapes, data cartridges, diskettes, optical disks, recordable
         compact disks and other products which store or record computer
         information and are used in a variety of computers ranging from
         notebook and personal computers to large mainframe computer systems.

                  AUDIO-VISUAL PRESENTATION PRODUCTS. Audio-visual presentation
         products sold by the Company include overhead projectors, professional
         audio-visual equipment, LCD projection panels, LCD portable projectors,
         laser pointers, projection screens and other projection presentation
         accessories.

                  ACCESSORIES AND OTHER PRODUCTS INCLUDING HARDWARE AND
         SOFTWARE. Accessories sold by the Company include cleaning supplies,
         disk storage boxes, data cartridge storage, point of sale and bar code
         supplies, racks, surge protection devices, workstation accessories and
         anti-glare screens. The Company also sells a limited number of other
         products such as paper, transparencies, banking supplies and selected
         business machines.

SUPPLIERS

         The Company's computer supply and office automation products are
manufactured by approximately 500 original equipment manufacturers, including
Hewlett-Packard, Sharp Electronics, Lexmark, Imation, Proxima, Epson, Sony and
Canon. Approximately 52.4% and 51.9% of the Company's total net sales were
derived from products supplied by the Company's ten largest original equipment
manufacturers in 1998 and 1997, respectively. The sales of products supplied by
Hewlett-Packard, Sharp and Lexmark accounted for approximately 13.0%, 8.0% and
7.7% respectively, of total net sales for 1998. The Company's audio-visual
presentation products are manufactured by five original equipment manufacturers,
including Sharp, Epson, Proxima, Infocus and Sony.

         The Company has entered into written distribution agreements with a
majority of the major suppliers of the products it distributes including
Hewlett-Packard, Lexmark, Imation, Sharp, Epson and Proxima. As is customary in
the industry, these 


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agreements generally provide non-exclusive distribution rights, have one year 
renewable terms, are terminable by either party at any time (with or without 
cause) and require notice of certain events such as a change in control of 
the Company. The Company considers its relationship with its major suppliers 
to be good and has recently renewed its direct purchasing agreements with 
Hewlett-Packard and several other suppliers. The Company is also discussing 
expanded direct purchasing arrangements with several major suppliers that 
would provide the Company with a broader product line and increased customer 
base. There can be no assurance, however, that a material change in the 
Company's relationship with one or more of its major suppliers will not occur 
and if it does occur, that it will not have a material adverse effect on the 
Company's business.

         Although the Company purchases most of its products directly from
authorized U.S. manufacturers, the Company also purchases products from foreign
and domestic sources. Depending upon product pricing and availability, the
Company also purchases products from secondary sources, such as wholesalers and
selected dealers, other than from the direct manufacturer. Approximately 17% and
23% of the Company's total net sales were derived from the sale of products
purchased from sources other than the direct manufacturers for 1998 and 1997,
respectively. The Company utilizes its ability to purchase imported and
secondary source products in order to increase its operating income and provide
its customers with competitive prices. In order to ensure that such imported and
secondary source products are not produced by unauthorized manufacturers, the
Company has established various steps and procedures which it believes enable it
to identify unauthorized products and the Company does not purchase from any
such sources. There can be no assurance, however, that the Company will be
completely successful in such efforts or that such imported and secondary source
products will continue to be available.

         Certain of the Company's major suppliers offer rebate programs under
which, subject to the Company purchasing certain predetermined amounts of
product, the Company receives rebates of the dollar volume of total rebate
program purchases. The Company also takes advantage of several other programs
offered by substantially all of its suppliers. These programs include price
protection plans under which the Company receives credits against future
purchases if the supplier lowers prices on previously purchased inventory and
stock rotation or stock balancing privileges under which the Company can return
slow moving inventory in exchange for other products.

SALES AND MARKETING

         The Company sells its products to approximately 50,000 middle-market
and smaller companies and to governmental, educational, wholesale and retail
customers, including federal, state and local governmental agencies,
universities and hospitals and to computer supply dealers. The Company's typical
customer is a small to medium sized corporate end-user who relies on
distributors, such as the Company, that provide high levels of value-added
service. No single customer accounted for more than 3.1% of the Company's sales
in 1998. The Company's international sales accounted for approximately 5.9% of
the Company's total net sales for the year ended 1998, which is expected in
increase in 1999 due to the acquisition of certain assets and liabilities in
December 1998 of Axidata Inc., Toronto, Canada.

         The Company's sales force provides national coverage and, as of 
December 31, 1998, consisted of 390 full-time sales representatives that work 
out of the Company's headquarters in Dayton, Ohio and from its 95 other sales 
offices. Those offices located in Akron/Canton, Cincinnati, Cleveland, 
Columbus, Toledo, Zanesville, Strongsville, Painesville, Dublin, and 
Youngstown, in Ohio; its five sales offices in Pennsylvania, located in 
Erie/Meadville, Davidsville, Pittsburgh, Harmer Township, and Philadelphia; 
its two offices in New York, located in Buffalo and Rochester, and its 
offices in Indianapolis, Indiana; Louisville and Lexington in Kentucky; Ann 
Arbor and Detroit in Michigan; Modesto, Burbank, San Diego, and Fremont in 
California; Fountain Inn, Columbia, Greenville and Charleston in South 
Carolina; Gastonia, Raleigh and Charlotte in North Carolina; Bellevue, 
Portland, Oregon, Seattle and Spokane in Washington; Rolling Meadows, 
Illinois; Salt Lake City, Utah; Idaho Falls, Idaho; Corvallis, Montana; 
Jacksonville, Altamonte, Miami, Tampa and Apopka in Florida; Tulsa Oklahoma; 
Olathe, Kansas; Gulfport and Jackson in Mississippi; Nashville, Chattanooga, 
Knoxville, Huntsville and Memphis in Tennessee; Springfield in Missouri; 
Goftstown, New Hampshire; Montgomery and Birmingham in Alabama; South 
Charleston, West Virginia; Houston, San Antonio, Dallas and Baytown in Texas 
in the United States; and Vancouver, Toronto, Montreal, Mississauga, and 
Quebec City in Canada and in Leeds, England. The Company relies on its direct 
sales force to initiate sales contacts, follow up on leads provided by 
manufacturers and to engage in face-to-face contact with its customers to 
solicit orders and provide service.

         The Company's direct sales force markets the Company's products and
services utilizing the Company's full-color catalogs and the sales
representative's ability to quote a price to the customer within a range which
maintains the Company's margins but gives the sales representative the
flexibility to price products competitively. The sales force works with the
Company's customers to simplify and reduce the cost of the product procurement
process by providing customized facsimile order forms, EDI processing and
customized billing and shipping, and product technical expertise. Outbound
telemarketing sales are primarily directed to federal government and other
corporate customers which have the authority to make their own purchases or are
purchasing specific products under master contracts with specific manufacturers
and which, in part, represent sales in markets in which the Company does not
have an office.


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         The Company believes that its ability to maintain and grow its customer
and net sales base will depend, in part, on its ability to maintain a high level
of customer satisfaction, as well as competitive prices. The Company believes
that its customers typically purchase computer supply and office automation
products based on an established long-term business relationship with their
primary suppliers. The Company establishes and maintains its relationships with
customers by assigning a sales and an in-house customer service representative
to most customers. Sales representatives have frequent contact with their
customers and are responsible for increasing account penetration and providing
customer service. Sales representatives also are responsible for marketing
efforts directed to prospective customers and for responding to all bid and/or
contract requests for their existing and prospective customers. Sales
representatives are compensated almost exclusively on a commission basis and
also receive Company benefits such as incentive recognition trips if quotas are
met. This compensation system provides the opportunity for individual sales
representatives to earn substantial incomes and has allowed the Company to
attract a highly professional driven sales force. The direct sales force model
allows the Company to offer a high level of customer service to its customer
base, including detailed product advice, post-sale support and customized
account histories and billing. In order to maintain relationships, the Company
ensures its sales force is highly knowledgeable about its products through the
use of training programs and cross promotion. The Company also endeavors to
locate and supply "difficult to find" items for its customers and to provide
post-sale technical support. The Company believes that its personalized
marketing strategy offers it a competitive advantage in responding to the needs
of each customer.

         The Company also has an in-house marketing department which assists its
sales representatives by generating leads and sales from existing accounts
resulting from direct mail advertisements and questionnaires and from direct
telephone solicitations.

         In order to ensure that the sales force is performing to its potential,
the Company and each individual salesperson annually reviews and sets sales
goals. The Company regularly monitors the performance of its sales staff by
reviewing sales and margin profitability. The Company pre-screens qualified
applicants, emphasizes continuing training and sets realistic sales goals.

DISTRIBUTION

         The Company's primary sales and distribution center is located in
Dayton, Ohio. The Company operates four regional sales and distribution centers
located in Berkeley, California; Nashville, Tennessee; Cleveland, Ohio; and
Toronto, Canada and fourteen smaller area distribution centers in Rochester, New
York; Louisville, Kentucky; Chicago, Illinois; Salt Lake City, Utah; Ann Arbor,
Michigan; Spokane, Washington; Atlanta, Georgia; Portland, Oregon; Strongsville,
Ohio; Houston, Texas; Fremont, California; Manchester, New Hampshire; Vancouver,
Toronto, and Montreal, Canada; and Leeds, England. Each of the Company's other
82 sales offices also maintains a limited inventory of frequently ordered
products in order to facilitate same day delivery. This distribution network
allows the Company to ship product to every state in the United States and to
its international customers on a timely basis.

         The Company believes that the automation achieved through its MIS has
resulted in: (i) more efficient management of its inventory; (ii) a consistently
high picking accuracy rate that has reduced shipping errors and the associated
costs of returned merchandise; (iii) significant savings as a result of
customized packaging which takes advantage of weight discounts and provides for
less frequent deliveries; and (iv) improved customer service which includes
order acceptance times as late as 7:00 p.m. Eastern Time.

         The Company ships packages primarily with United Parcel Service ("UPS")
or Roadway Package Service ("RPS"). The Company's arrangements with UPS and RPS
enable the Company to offer to its customers a competitive shipping rate and
next business day delivery to most U.S. geographic areas. When the Company ships
packages with UPS or RPS, it will label the package with a UPS or RPS bar code
for tracking purposes, enabling the Company to track a customer's package from
the time it is put on the courier's vehicle until delivery. Some of the
Company's products are shipped from the manufacturer directly to the Company's
customers. The Company ships virtually all orders for products in stock on the
same day.

INVENTORY MANAGEMENT

         The Company manages its inventory by maintaining sufficient quantities
of the most frequently ordered products to achieve high order fill rates while
at the same time attempting to maximize inventory turns. Items not maintained in
inventory are drop-shipped (i.e. shipped from the manufacturer's loading dock)
directly to the Company's customers. While the Company sells more than 37,100
stock keeping units ("SKUs") or items of merchandise, approximately 1,150 SKUs
account for approximately 70.0% of the Company's net sales. Consequently, the
Company continually attempts to identify slow moving inventory by use of its
computer software applications and removes those SKUs whenever possible in order
to maximize inventory turns. Inventory balances will fluctuate as the Company
adds new product lines, when it makes large purchases from suppliers to take
advantage of attractive terms and when certain inventory items are deleted.
Inventory turnover on an annual basis was 10 times for the year ended December
31, 1998.

         The Company permits its customers to return defective products (most of
which are then returned by the Company to the manufacturer) and incorrect
shipments for credit against other purchases. To date, the Company's net expense
for returns of the 


                                       8

<PAGE>

Company's products has not been material. To reduce the risk of loss to the 
Company due to manufacturer price reductions and slow moving or obsolete 
inventory, the Company's agreements with certain manufacturers, including 
most of its major suppliers, contain provisions which permit "stock 
balancing" and, subject to certain restrictions, price protections. See 
"--Suppliers."

MANAGEMENT INFORMATION SYSTEM

         The Company has continually invested in hardware, software and
programming upgrades to its information systems, which is run primarily from an
IBM AS/400 computer located at its Dayton, Ohio headquarters. The Company is
utilizing the J. D. Edwards enterprise resource planning ("ERP") distribution
software, which has aided in consolidating subsidiaries, and has automated a
large number of key business functions using on-line, real time systems,
including electronic commerce. These on-line systems provide management with
information concerning sales, inventory levels, customer payments and other
operations which are essential for the Company to operate as a low cost, high
efficiency distributor. Each of the Company's offices has either a direct,
full-time dedicated link to the Company's in-house computer system, or may
obtain such access through the Internet. The Company maintains five full-time
computer programmers who work on a continual basis to upgrade the Company's
software capability. The "down time" for the Company's computer system has been
negligible to date.

EMPLOYEES

         As of December 31, 1998, the Company had 1,287 full-time employees, of
which 390 were in sales. None of the Company's employees are represented by a
labor union, and the Company has never suffered an interruption of business as a
result of a labor dispute. The Company considers its relations with its
employees to be excellent.

COMPETITION

         The Company believes that most, if not all, of its customers maintain
several sources of supply for their product requirements. Accordingly, the
Company competes with major full-service office products distributors, other
national and regional computer supply and audio-visual presentation product
distributors, office products superstores, direct mail order companies, and to a
lesser extent, non-specialized retailers. Certain of the Company's competitors,
such as office products superstores and major full-service office products
distributors, are larger and have substantially greater financial and other
resources and purchasing power than the Company. Competition in the Company's
industry is generally based on price, breadth of product lines, product and
credit availability, a knowledgeable sales force, delivery time and the level
and quality of customer services. The Company believes that the computer supply
and audio-visual presentation product industry will become more consolidated in
the future and thereby more competitive. Increasing competition will result in
greater price discounting which may have a negative impact on the industry's
gross margins.

         The Company believes its competitive advantage over other distributors
includes its ability to efficiently maintain a wide selection of name brand
products in stock ready to be shipped on a same day basis and delivered
overnight, to efficiently distribute its products, to provide innovative and
high quality value-added customer service programs and to respond to changing
customer demand and product development. However, there can be no assurance that
the Company will not encounter increased competition in the future, which could
have a material adverse effect on the Company's business.

ENVIRONMENTAL MATTERS

         The Company is subject to federal, state and local laws, regulations
and ordinances that: (i) govern activities or operations that may have adverse
environmental effects, such as discharges to air and water as well as handling
and disposal practices for solid and hazardous wastes, or (ii) impose liability
for the costs of cleaning up, and certain damages resulting from, sites of past
spills, disposals or other releases of hazardous substances.

         The Company currently is not aware of any environmental conditions
relating to present or past waste generation at or from its facilities or
operations, that would be likely to have a material adverse effect on the
financial condition or results of operations of the Company. However, there can
be no assurance that environmental liabilities in the future will not have a
material adverse effect on the financial condition or results of operations of
the Company.

BACKLOG

         The Company does not have a significant backlog of orders and does not
consider backlog relevant to its business.


                                       9

<PAGE>

SUBSIDIARIES

         At December 31, 1998, the Company has eleven wholly owned subsidiaries,
Diversified Data Products, Inc. ("DDP") headquartered in Ann Arbor, Michigan,
which has two subsidiaries, Diversified Data Products (U.K) Limited ("DDP-UK")
headquartered in Leeds, England and Compass Export Marketing (Overseas) Limited
("CEM") (which is inactive); TBS Printware, Inc. ("TBS") located in Fremont,
California; Britco, Inc. ("Britco") with two offices in Houston, Texas, one of
which is Britco's headquarters and two other offices in San Antonio and Baytown
in Texas; Minnesota Western, Inc. ("MW, which is headquartered in Berkeley,
California with offices in Walnut Creek, Santa Clara, San Mateo, Sacramento,
Santa Rosa, Tustin, Pasadena, Los Angeles, Fresno, Oxnard, Rancho Cucamonga,
Canoga Park, San Diego in California, Seattle, Washington and Portland, Oregon;
Computer Showcase, Inc. ("CS") headquartered in Norcross, Georgia; Electronic
Image Systems, Inc., ("EIS") headquartered in Bellevue, Washington with one
office in Portland, Oregon; Consolidated Media Systems, Inc., ("CMS")
headquartered in Nashville Tennessee with offices in Chattanooga, Knoxville,
Memphis, Jackson, Altamonte, Montgomery, Birmingham, Cincinnati, Lexington,
South Charleston, Columbus, Louisville, Miami, Springfield, Dallas, Burbank, San
Diego, Tampa, Houston, Tulsa, and Huntsville; Axidata Inc., ("AI") headquartered
in Scarborough, Ontario with offices in Vancouver, Ottawa, Mississauga, Quebec
City, and two locations in Montreal; and Dreher Business Products, Inc., ("DBP")
headquartered in Strongsville, Ohio with offices in Harmer Township,
Pennsylvania; Painesville, and Dublin, Ohio.


                                       10

<PAGE>

ITEM 2.  PROPERTIES

         The Company's principal executive offices are located in Dayton, Ohio.
The Company leases all of its office and warehouse space for use in the ordinary
course of business. The leases expire at various times through 2026 and some of
the Company's leases contain options to renew. The Company expects that it will
be able to renew leases expiring in 1998 at rents which are substantially
similar to current rent payments on a square footage basis.

         The Company's material sales and warehouse locations are described in
the table below:

<TABLE>
<CAPTION>

                                                                         Lease
                           Location                         Square Feet        Expiration Date
                           --------                         -----------        ---------------
<S>                                                         <C>                <C>
Ann Arbor, Michigan . . . . . . . . . . . . . .                 5,500                 2001
Bellevue, Washington  . . . . . . . . . . . . .                11,400                 2002
Berkeley, California  . . . . . . . . . . . . .                36,000                 2004
Chicago, Illinois . . . . . . . . . . . . . . .                 4,659                 2003
Dayton, Ohio  . . . . . . . . . . . . . . . . .                30,000                 2006
Fremont, California . . . . . . . . . . . . . .                17,800                 2001
Houston, Texas. . . . . . . . . . . . . . . . .                 9,140              monthly
Louisville, Kentucky. . . . . . . . . . . . . .                 7,500                 2004
Mississauga, Canada . . . . . . . . . . . . . .                44,500                 1999
Montreal, Canada. . . . . . . . . . . . . . . .                26,700                 1999
Montreal, Canada. . . . . . . . . . . . . . . .                12,290              monthly
Nashville, Tennessee  . . . . . . . . . . . . .                31,350                 2002
Nashville, Tennessee. . . . . . . . . . . . . .                13,170                 2002
Norcross, Georgia . . . . . . . . . . . . . . .                 6,000                 2001
Portland, Oregon  . . . . . . . . . . . . . . .                 6,000                 2000
Rochester, New York . . . . . . . . . . . . . .                12,032                 2000
Roswell, Georgia  . . . . . . . . . . . . . . .                 8,200                 1999
Spokane, Washington . . . . . . . . . . . . . .                15,000                 2000
Strongsville, Ohio  . . . . . . . . . . . . . .                46,000                 2026
Toronto, Canada . . . . . . . . . . . . . . . .                82,100                 2006
Tustin, California  . . . . . . . . . . . . . .                16,000                 2002
Vancouver, Canada . . . . . . . . . . . . . . .                24,800                 2007

</TABLE>

Properties acquired subsequent to December 31, 1998 are not included in the
table.


                                       11

<PAGE>

ITEM 3.  LEGAL PROCEEDINGS

         The Company has been involved, from time to time, in certain litigation
resulting from the hiring of sales representatives who have worked for other
computer and office supply and audio-visual presentation product companies
immediately prior to their hiring by the Company and from other activities
arising from the normal course of its operations. In the opinion of management,
none of the matters pending at December 31, 1998 are likely to have a material
adverse effect on the Company's financial condition or results of operations.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.


                                       12

<PAGE>

                                    PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
         MATTERS
         
COMMON STOCK DATA:

         The Company's Common Stock is listed and trades on the Nasdaq 
National Market tier of the Nasdaq Stock Market under the symbol "MCSC." The 
following table sets forth for the periods indicated the high and low closing 
sale price for the Common Stock as reported by the Nasdaq National Market as 
adjusted to reflect the 3 for 2 stock split paid April 24, 1998.

<TABLE>
<CAPTION>

                                              1997                1998
                                              ----                ----
         Quarter                         High      Low       High       Low
         -------                         ----      ---       ----       ---
         <S>                        <C>        <C>       <C>       <C>
         First. . . . . . . . . . . .   $9.000    $6.167    $17.667    $8.750
         Second . . . . . . . . . . .   $8.167    $6.000    $19.625   $16.125
         Third. . . . . . . . . . . .  $10.000    $7.833    $22.000   $14.500
         Fourth . . . . . . . . . . .  $10.000    $8.500    $26.625   $16.313
         Year . . . . . . . . . . . .  $10.000    $6.000    $26.625    $8.750

</TABLE>

     As of March 26, 1999, there were approximately 197 shareholders of 
record.

     The declaration of cash dividends is at the discretion of the Board of 
Directors of the Company, and is limited by the Company's borrowing 
arrangements.  No cash dividends on the Common Stock have been declared or 
paid by the Company to date.  The Company does not anticipate paying cash 
dividends in the foreseeable future.

ITEM 6.  SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>

                                                               Year Ended December 31,
                                        --------------------------------------------------------------------
Statement of Operations                              (Dollars in thousands, except per share data)
    Data:                                 1994           1995          1996(1)        1997(3)        1998(4)
                                          ----           ----          -------        -------        -------
 <S>                                  <C>            <C>            <C>           <C>            <C>
    Net sales . . . . . . . . . . . .    $35,690        $43,321        $63,428       $107,487       $313,762
    Cost of sales . . . . . . . . . .     28,250         34,642         52,061         88,190        246,670
                                         -------        -------        -------       --------       --------
    Gross profit . . . . . . . . . . .     7,440          8,679         11,367         19,297         67,092
    Selling, general and
     administrative  expenses . . . .      6,219          7,125          8,891         15,441         53,389
    Non-cash compensation
     expense . . . . . . . . . . . . .        --             --            280             --             --
                                         -------        -------        -------       --------       --------
    Operating  income . . . . . . . .      1,221          1,554          2,196          3,856         13,703
    Interest  expense  . . . . . . . .      (204)          (274)          (312)          (180)        (2,611)
    Other (expense) income . . . . . .        11             22            (11)            43            227
                                         -------        -------        -------       --------       --------
    Income before income
     taxes . . . . . . . . . . . . . .     1,028          1,302          1,873          3,719         11,319
    Provision for income taxes. .  .         418            509            756          1,507          4,994
                                         -------        -------        -------       --------       --------

    Net income .  . . . . . . . . . .       $610           $793         $1,117         $2,212         $6,325
                                         =======        =======        =======       ========       ========
    Earnings per share of common
     stock - basic . . .  .  . . . . .     $0.18          $0.22          $0.29          $0.39          $0.66
                                         =======        =======        =======       ========       ========
    Earnings per share of common
     stock - diluted  . . . . . . . .      $0.18          $0.22          $0.29          $0.39          $0.65
                                         =======        =======        =======       ========       ========
    Weighted average number of
     common shares
     outstanding -basic . . . . . . .  3,480,000      3,582,000      3,798,599      5,671,833      9,536,957
                                       =========      =========      =========      =========      =========
    Weighted average number of
     common shares
     outstanding - diluted. . . . . .  3,480,000      3,582,000      3,814,139      5,722,440      9,677,285
                                       =========      =========      =========      =========      =========

</TABLE>
                                                         13

<PAGE>

<TABLE>
<CAPTION>

                                                                                     At December 31,
                                                          ---------------------------------------------------------------------
                                                                                 (Dollars in thousands)
Balance Sheet Data (at end of period):                       1994           1995         1996(2)        1997(3)        1998(4)
                                                             ----           ----         -------        -------        -------
 <S>                                                    <C>           <C>           <C>              <C>           <C>
    Working capital . . . . . . . . . . . . . .  . . . .     $944         $1,510        $10,211         $8,188        $81,334
    Total assets  . . . . . . . . . . . . . . .  . . . .    8,782          9,544         17,775         49,921        249,980
    Long-term debt. .   . . . . . . . . . . . .  . . . .        6           --               65            112        107,906
    Total debt. .  . . . . . . . . . . . . . . . . . . .    3,005          3,537            100          8,207        108,204
    Stockholders' equity .  . . . . . . . . . . .. . . .    1,839          2,362         12,073         25,031         97,194
</TABLE>
---------------------------------------
(1)  Includes the results of operations of DDP subsequent to its acquisition 
on May 30, 1996.  See Note 3 to the Consolidated Financial Statements.

(2)  Includes the acquisition of DDP on May 30, 1996 and the Company's 
initial public offering on November 12, 1996.  See Notes 3 and 10 to the 
Consolidated Financial Statements.

(3)  Includes the results of operations of Imperial Data Supply Corporation, 
Inc. ("IDS") subsequent to its acquisition on April 30, 1997, Data Associates 
Inc. ("DA") subsequent to its acquisition on July 1, 1997, Force 4, D.P. 
Supplies, Inc. subsequent to its acquisition on July 15, 1997, NTI Data 
Products, Inc. subsequent to its acquisition on October 7, 1997, and Britco, 
Inc., subsequent to its acquisition on December 5, 1997.  TBS Printware, 
Inc., is not included in the statement of operations data, but is included in 
the balance sheet data due to its acquisition occurring on December 31, 1997. 
 The subsidiaries IDS, DA, Force 4, and NTI Data Products have been 
subsequently merged into the Company.  See Note 3 to the Consolidated 
Financial Statements.

(4)  Includes the results of MW subsequent to its acquisition on January 16, 
1998, EIS subsequent to its acquisition on June 12, 1998, Computer Showcase 
subsequent to its acquisition on February 28, 1998, CMS subsequent to its 
acquisition on September 11, 1998, Optical Express subsequent to its 
acquisition on September 30, 1998, Jack Kelly & Associates subsequent to its 
acquisition on October 13, 1998, JOS Projection Systems, Inc. subsequent to 
the acquisition of its assets on October 30, 1998, Axidata Inc., subsequent 
to  the acquisition of its assets on December 11, 1998, and Dreher Business 
Products subsequent to its acquisition on December 15, 1998.  Jack Kelly & 
Associates and Optical Express have been subsequently merged into the Company.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

     THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH "SELECTED 
FINANCIAL DATA" AND THE CONSOLIDATED FINANCIAL STATEMENTS AND NOTES THERETO 
OF THE COMPANY INCLUDED ELSEWHERE HEREIN.  THE FOLLOWING INFORMATION CONTAINS 
FORWARD-LOOKING STATEMENTS WHICH INVOLVE CERTAIN RISKS AND UNCERTAINTIES. 
ACTUAL RESULTS AND EVENTS MAY DIFFER SIGNIFICANTLY FROM THOSE DISCUSSED IN 
THE FORWARD-LOOKING STATEMENTS.  SEE EXHIBIT 99, ATTACHED HERETO.

OVERVIEW

     The Company's past sales growth has been due, in part, to the 
acquisition of ten computer and office automation supply companies and six 
presentation products companies since its initial public offering in November 
1996.  The Company  intends to increase the scope of its operations through 
additional acquisitions in the future.  The Company continues to evaluate 
potential acquisitions and to identify and have preliminary discussions with 
potential acquisition candidates, although there are, as of the date of this 
Form 10-K, no definitive acquisition agreements between the Company and any 
other party relating thereto.  There can be no assurance that any future 
acquisition can or will be consummated on terms favorable to the Company, or 
at all.

     The Company completed nine acquisitions of computer supply and office
automation and audio-visual presentation products distributors in 1998.



                                      14
<PAGE>

RESULTS OF OPERATIONS

     As an aid to understanding the Company's operations on a comparative 
basis, the following table has been prepared to set forth certain statement 
of operations data for 1996, 1997 and 1998.

<TABLE>
<CAPTION>

                                                                       Year Ended December 31,
                                                               ----------------------------------------
                                                                  1996           1997           1998
                                                                  ----           ----           ----
                                                                 Percent        Percent        Percent
                                                                 -------        -------        -------
<S>                                                            <C>            <C>            <C>
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . .      100.0%        100.0%          100.0%
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . .       82.1          82.0            78.6
                                                                 -------        -------        -------
Gross profit. . . . . . . . . . . . . . . . . . . . . . . . .       17.9          18.0            21.4
Selling, general and administrative expenses . . . . . . . .        14.0          14.4            17.0
Non-cash compensation expense . . . . . . . . . . . . . . . .        0.4            --              --
                                                                 -------        -------        -------

Operating income. . . . . . . . . . . . . . . . . . . . . . .        3.5            3.6            4.4
Interest expense. . . . . . . . . . . . . . . . . . . . . . .       (0.5)          (0.2)          (0.8)
Other (expense)/income. . . . . . . . . . . . . . . . . . . .         --             --             --
                                                                 -------        -------        -------
Income before income taxes. . . . . . . . . . . . . . . . . .        3.0            3.4            3.6
Provision for income taxes. . . . . . . . . . . . . . . . . .        1.2            1.4            1.6
                                                                 -------        -------        -------
Net income  . . . . . . . . . . . . . . . . . . . . . . . . .        1.8%           2.0%           2.0%
                                                                 =======        =======        =======

</TABLE>

YEAR ENDED DECEMBER 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997

     NET SALES. Net sales for the year ended December 31, 1998 increased by 
$206.3 million or 192% to $313.8 million from $107.5 million for the year 
ended December 31, 1997.  Of this net sales increase, 69.6% was attributable 
to the Company's acquisitions in 1998, and the remaining 30.4% of the 
increase was primarily a result of increased sales penetration, product 
offerings to existing customers, expanding the sales force, and the 
annualized impact of acquisitions made during 1997.

     GROSS PROFIT. Gross profit for the year ended December 31, 1998 
increased by $47.8 million or 247.7%, to $67.1 million from $19.3 million for 
the year ended December 31, 1997.  Gross profit as a percentage of net sales 
for the year ended December 31, 1998 was 21.4% compared to 18.0% for the year 
ended December 31, 1997.  Margins improved in 1998 as a result of the 
Company's increased sales volume from audio-visual presentation products 
which has higher gross margins than computer supply products.  

     SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.  Selling, general and 
administrative expenses for the year ended December 31, 1998 increased by 
$38.0 million, or 245.8% to $53.4 million from $15.4 million for the year 
ended December 31, 1997.  Approximately 71.2% of this increase was due to the 
acquisitions in 1998 and approximately 28.8% of this increase was due to the 
annualized impact of 1997 acquisitions and increased infrastructure due to 
the rapid growth of the company.  As a percentage of net sales, selling, 
general and administrative expenses were 17.0% for the year ended December 
31, 1998 compared to 14.4% for the year ended December 31, 1997.  The 2.6% 
increase was due primarily to higher selling general and administrative 
expenses associated with the audio-visual presentation products business.

     OPERATING INCOME. Operating income for the year ended December 31, 1998 
was $13.7 million as compared to $3.9 million for the year ended December 31, 
1997, an increase of $9.8 million or 255.4%.  This increase was primarily due 
to increased sales volume and the acquisitions that the Company completed in 
1998.

     INTEREST EXPENSE. Interest expense for the year ended December 31, 1998 
increased $2.4 million to $2.6 million from $.2 million for the year ended 
December 31, 1997, due primarily to the increased level of average 
indebtedness in 1998 from the Company's acquisition program.  See "Credit 
Facility."

     PROVISION FOR INCOME TAXES. Provision for income taxes for the year 
ended December 31, 1998 increased by $3.5 million to $5.0 million from $1.5 
million for the year ended December 31, 1997.  The Company's effective tax 
rate for 1998 was 44.1% compared to 40.5% for the year ended December 31, 
1997.  The increase was primarily due to non-deductible goodwill amortization 
resulting from the Company's acquisition program.

                                      15
<PAGE>

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996

     NET SALES.  Net sales for the year ended December 31, 1997 increased by 
$44.1 million or 69.5% to $107.5 million from $63.4 million for the year 
ended December 31, 1996.  Of this net sales increase, 44.0% was attributable 
to the Company's acquisitions in 1997, 35.3% was attributable to the 
Company's acquisition of DDP in 1996 and the remaining 20.7% increase was 
primarily a result of increased sales penetration, product offerings to 
existing customers and expanding the sales force.  
      
     GROSS PROFIT.  Gross profit for the year ended December 31, 1997 
increased by $7.9 million or 69.8%, to $19.3 million from $11.4 million for 
the year ended December 31, 1996.  Gross profit as a percentage of net sales 
for the year ended December 31, 1997 was 18.0% compared to 17.9% for the year 
ended December 31, 1996.  Margins improved in 1997 as a result of the 
Company's acquisition program.  Even though DDP has lower margins than the 
other businesses of the Company, the improvements in margin was offset by a 
full year of DDP's operations.    

     SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.  Selling, general and 
administrative expenses for the year ended December 31, 1997 increased by 
$6.5 million, or 73.7% to $15.4 million from $8.9 million for the year ended 
December 31, 1996.  Approximately 54.3% of this increase was due to the 
acquisitions in 1997,  13.0% of this increase was due to the acquisition of 
DDP in May 1996 and approximately 32.7% of this increase was due to increased 
salary, bonus, commission and rent expenses.  As a percentage of net sales, 
selling, general and administrative expenses were 14.4% for the year ended 
December 31, 1997 compared to 14.0% for the year ended December 31, 1996.  
The 0.4% increase was due primarily to increased selling, general and 
administrative expenses resulting from the acquired entities.

     OPERATING INCOME.  Operating income for the year ended December 31, 1997 
was $3.9 million as compared to $2.2 million for the year ended December 31, 
1996, an increase of $1.7 million or 75.6%.  This increase was primarily due 
to increased sales volume and the acquisitions that the Company completed in 
1997.

     INTEREST EXPENSE.  Interest expense for the year ended December 31, 1997 
decreased $131,954 to $180,373 from $312,327 for the year ended December 31, 
1996, due primarily to the decreased level of average indebtedness in 1997, 
made possible from the Company's sale of stock through the initial public 
offering in November 1996.  See "Credit Facility." 

     PROVISION FOR INCOME TAXES  Provision for income taxes for the year 
ended December 31, 1997 increased by $751,327 to $1,507,020 from $755,693 for 
the year ended December 31, 1996.  The Company's effective tax rate was 40.5% 
compared to 40.3% for the year ended December 31, 1996.

LIQUIDITY AND CAPITAL RESOURCES

     Net cash flows used in operating activities were $0.3 million and $1.9 
million for the years ended December 31, 1997 and 1998, respectively.  For 
the year ended December 31, 1996, net cash flows used by operating activities 
were $1.3 million.  Cash flows used in operations during the three year 
period ended December 31, 1998 relate to the Company's expansion and the 
resultant increases in net income, receivables and inventories.  Working 
capital amounted to $81.3 million at December 31, 1998, compared to $8.2 
million at December 31, 1997. The expansion of the Company's operations as a 
result of its acquisition strategy and the conversion of the Company's Credit 
Facility (see below) to long term indebtedness are the primary reasons for 
this increase.

     Capital expenditures for the years ended December 31, 1996, 1997 and 
1998 were $0.5 million  $0.6 million, and $6.6 million, respectively.  Funds 
were used primarily to upgrade and enhance the Company's computer systems.  

     For fiscal year 1999, the Company expects capital expenditures of 
approximately $3.0 million to be used for upgrading the Company's MIS.  
Actual capital expenditures for fiscal 1999 may be greater than budgeted 
amounts depending on the level of acquisition activity and other factors.

     In 1998, the Company's board of directors approved repurchase of up to 
5% of the Company's outstanding common stock.  During 1998 the Company 
purchased 445,900 shares on the open market at prices ranging from $14.00 to 
$17.88 per share.  The majority of these shares were subsequently reissued as 
consideration in acquisition transactions.

     Cash from financing activities was provided from the Company's public 
offering which closed in July 1998.  Net proceeds from the offering totaled 
$35,762,000

     The Company believes that its cash on hand, borrowing capacity under the 
Credit Facility and capital resources will be sufficient to fund its ongoing 
operations and budgeted capital expenditures for 1999, although actual 
capital needs may change, particularly in connection with acquisitions which 
the Company may make in the future.  The Company's long-term requirements 



                                      16
<PAGE>

including capital expenditures and acquisitions, are expected to be financed 
by a combination of internally generated funds, additional borrowings and 
other sources of external financing (including possible public or private 
debt or equity offerings) as needed.

CREDIT FACILITY

     In January 1998, the Company entered into a new credit facility with PNC 
Bank, N.A. (the "Bank"), Key Corporate Capital, Inc. and National City Bank, 
for a secured general revolving line of credit of $50.0 million, which was 
increased to $125.0 million in December 1998 (the "Credit Facility").  Loans 
under the Credit Facility may be incurred by the Company from time to time to 
finance "permitted acquisitions" and may be made at the Bank's prime rate (as 
defined) or at the defined published eurodollar rate plus a "eurodollar 
margin" that ranges from 100 to 200 basis points based on certain 
indebtedness ratios of the company.  Borrowings under the Credit Facility are 
secured by substantially all of the assets and property of the Company and 
its subsidiaries, including accounts receivable, equipment and inventory.  
The loan commitment terminates on the maturity date (December 10, 2003), 
unless terminated earlier.  The Company may voluntarily prepay any advance 
without penalty or premium at any time or from time to time.

     The Credit Facility contains restrictive covenants which may have an 
adverse effect on the Company's operations in the future.  The Company has 
covenanted that, among other things, it will not: (i) change the nature of 
its business; (ii) liquidate or dissolve its affairs, merge, consolidate or 
acquire the property or assets of any person, other than permitted 
acquisitions that comply with the financial covenants of the Credit Facility, 
certain intercompany mergers, permitted investments, permitted dispositions, 
certain capital expenditures and leases; (iii) permit the incurrence of any 
lien on the Company's property and assets; (iv) incur other indebtedness, 
except for up to $7.0 million of indebtedness incurred by foreign 
subsidiaries and for certain capital leases up to $10.0 million, certain 
guaranties and existing indebtedness; (v) pay cash dividends or repurchase 
more than a certain amount of its capital stock (vi) violate certain 
financial covenants; or (vii) engage in certain other transactions.

INFLATION

     Certain of the Company's product offerings, particularly paper products, 
have been and are expected to continue to be subject to significant price 
fluctuations due to inflationary and other market conditions.  The Company is 
generally able to pass such increased costs on to its customers through price 
increases, although the Company may not be able to adjust its prices 
immediately.  In general, the Company does not believe that inflation has had 
a material effect on its results of operations in recent years.  
Technological advances have caused its prices on certain products to 
decrease, which could have a negative impact on margins.

YEAR 2000

1) THE RISKS AND THE COMPANY'S STATE OF READINESS:
     The Company is aware of the issues associated with the hardware, 
software and operating systems in existing computer and telecommunication 
systems as the millennium approaches.  The "year 2000" problem is pervasive 
and complex as virtually every computer operation will be affected in some 
way by the rollover of the two digit year value to 00.  The issue is whether 
computer and other computer operated systems will properly recognize 
date-sensitive information when the year changes to 2000.  Systems that do 
not properly recognize such information could generate erroneous data or 
cause a system to fail.

     The Company is utilizing internal and external resources to identify and 
correct, or reprogram, all systems for year 2000 compliance.  The Company's 
AS/400 hardware and operating system are already compliant.  The Company is 
implementing a corporate wide financial and distribution software package 
from J. D. Edwards Company in response to the Company's expansion and 
acquisition program.  This software package is year 2000 compliant.  The J.D. 
Edwards Company software package was installed on January 4, 1999 at the 
Company headquarters.  All of the Company's subsidiaries with critical Year 
2000 issues will be converted to this software package during the first nine 
months of 1999. 

     All other equipment is currently undergoing compliance testing.  In 
cases of non-compliance, equipment will be replaced.  This equipment includes 
PCs, networking equipment, telecommunication equipment, phone and alarm 
systems.

     The Company has not completed an assessment of third party readiness.  
The Company regularly carries products and accessories manufactured by over 
500 original equipment manufacturers.  Approximately 52% of the Company's net 
sales for the year ended December 31, 1998, were provided by its suppliers.  
The Company intends to obtain written assurance from these suppliers that 
they expect to be Year 2000 compliant on a timely basis.  Should a 
significant number of the Company's suppliers not be Year 2000 compliant, the 
Company might not be able to supply its customers with product on a timely 
basis, bill timely for its products or collect its account receivable on a 
timely basis.  Such a disruption could have a material adverse affect on the 
Company's operation and financial performance.  The Company expects to 
complete its evaluation of third party readiness during the second quarter of 
1999.



                                      17
<PAGE>

2) THE COSTS TO ADDRESS THE COMPANY'S YEAR 2000 ISSUES:
     The cost of year 2000 compliance and the J.D. Edwards software 
conversion to date has approximated $3.6 million.  The cost to bring the 
Company into compliance and convert its financial and distribution systems to 
the J. D. Edwards system is currently estimated to be approximately $6.3 
million including the amount spent to date. 

3) THE COMPANY'S CONTINGENCY PLANS:
     The Company is continuing to develop contingency plans as needed in the 
future, including the determination of alternative service providers if the 
Company's current third party service providers become incapable of 
performing services for the Company and/or its customers as a result of the 
year 2000 problem.

NEW ACCOUNTING PRONOUNCEMENTS

     In June 1998, the Financial Accounting Standards Board issued Statement 
of Financial Accounting Standards ("SFAS") No. 133 "Accounting for Derivative 
Instruments and Hedging Activities."  SFAS No. 133 establishes accounting and 
reporting standards for derivative instruments, including forward foreign 
exchange contracts, and for hedging activities.  The Company enters into 
forward foreign exchange contracts to hedge certain foreign currency 
denominated transactions.  SFAS No. 133 will be effective for the Company's 
financial reporting beginning in 2000.  It will require entities to recognize 
all derivatives as either assets or liabilities in the statement of financial 
position and measure those instruments at fair value.  The accounting for 
gains and losses from changes in the fair value of a particular derivative 
will depend on the intended use of the derivative.  The Company does not 
expect that the eventual adoption of SFAS No. 133 will have a material impact 
on the results of its operations or financial position.   

FORWARD-LOOKING INFORMATION

     The matters discussed in this Form 10-K, other than historical 
information, and, in particular, information regarding future revenue, 
earnings and business plans, intentions and goals, consist of forward-looking 
information under the Private Securities Litigation Reform Act of 1995, and 
are subject to and involve risks and uncertainties which could cause actual 
results to differ materially from the forward-looking information.  These 
risks and uncertainties include, but are not limited to, those factors set 
forth in Exhibit 99 hereto, as well as general economic conditions, general 
levels of market rates of interest, industry trends, changes in management, 
the loss of key suppliers or customers, the loss of shipping relationships, 
change in customer demand, product availability, competition (including 
pricing and availability), concentrations of credit risk, distribution 
efficiencies, capacity constraints, risks inherent in acquiring, integrating 
and operating businesses, technological difficulties, exchange  rate 
fluctuation and the regulatory and trade environment (domestic and foreign).

ITEM 7A. QUANTITIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

     The primary market risks facing the Company deal with foreign currency 
risk, credit risk and interest rate risk.

Foreign Operations
     Prior to December 11, 1998, the Company's sales in international markets
were insignificant.  On December 11, 1998, the Company purchased certain assets
and liabilities of Axidata, Inc. ("Axidata"), a Canadian computer supply and
office products wholesaler.  Substantially all of Axidata's business is
conducted in Canada and in Canadian dollars.

Credit Risk
     Credit risk with respect to trade accounts receivable is generally
diversified due to the large number of entities comprising the Company's
customer base.  Management establishes policies with respect to credit risks and
monitors compliance with those policies.  No single customer accounted for more
than 10% of consolidated sales for the years ended December 31, 1996, 1997 and
1998.

Hedging Activities
     From time-to-time, the Company enters into foreign currency forward
contracts to hedge assets or liabilities denominated in foreign currencies. 
Forward contracts at December 31, 1997 and 1998 were not material.

Interest Rate Risk
     The Company is exposed to interest rate risk because the Company's
borrowing arrangements generally carry variable rates of interest.  The Company
has not, to date engaged in derivative transactions, such as interest rate
swaps, caps or collars, in order to reduce its risk.  A significant increase in
interest rates could have an adverse effect on the Company.  For example, based
upon the level of the Company's variable borrowings at December 31, 1998, a 1%
increase in interest rates would result in an increased charge against earnings
of approximately $1,000,000.



                                      18
<PAGE>

ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                                       PAGE
                                                                                       ----
<S>                                                                                    <C>
Report of Independent Accountants . . . . . . . . . . . . . . . . . . . . . . . . .      20

FINANCIAL STATEMENTS:
 Consolidated  Balance Sheet at December 31, 1997 and 1998. . . . . . . . . . . . . .    21

 Consolidated Statement of Operations for the years ended
          December 31, 1996, 1997 and 1998 . . .  . . . . . . . . . . . . . . . . .      22

 Consolidated Statement of Changes in Stockholders' Equity for
          the years ended December 31, 1996, 1997 and 1998. . . . . . . . . . . . .      23

 Consolidated Statement of Comprehensive Income for the years ended
          December 31, 1996, 1997 and 1998. . . . . . . . . . . . . . . . . . . . .      23

 Consolidated Statement of Cash Flows for the years ended
           December 31, 1996, 1997 and 1998 . . . . . . . . . . . . . . . . . . . .      24

Notes to the Consolidated Financial Statements. . . . . . . . . . . . . . . . . . .     25-34
</TABLE>


                                     19
<PAGE>

                         REPORT OF INDEPENDENT ACCOUNTANTS
                                          
TO THE BOARD OF DIRECTORS AND STOCKHOLDERS OF MIAMI COMPUTER SUPPLY CORPORATION

     In our opinion, the consolidated financial statements listed in the
accompanying index present fairly, in all material respects, the financial
position of Miami Computer Supply Corporation and its subsidiaries at December
31, 1998 and 1997, and the results of their operations and their cash flows for
each of the three years in the period ended December 31, 1998, in conformity
with generally accepted accounting principles.  These financial statements are
the responsibility of the Company's management; our responsibility is to express
an opinion on these financial statements based on our audits.  We conducted our
audits of these statements in accordance with generally accepted auditing
standards which require that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for the opinion expressed above.









/s/  PRICEWATERHOUSECOOPERS LLP
PRICEWATERHOUSECOOPERS LLP
Cincinnati, Ohio
February 20, 1999


                                     20

<PAGE>

                         MIAMI COMPUTER SUPPLY CORPORATION
                                          
                             CONSOLIDATED BALANCE SHEET
                               (Dollars in thousands)

<TABLE>
<CAPTION>

                                                                            December 31,
                                                                            ------------
                        ASSETS                                           1997          1998
                                                                       ------        -------
<S>                                                                  <C>           <C>
 Current assets:
    Cash and cash equivalents . . . .  . . . . . . . . . . . . .     $  1,663      $   4,115
    Accounts receivable (Note 4). .  . . . . . . . . . . . . . .       21,490         78,870
    Inventories . . . . . . .  . . . . . . . . . . . . . . . . .        9,112         40,109
    Prepaid expenses  . .  . . . . . . . . . . . . . . . . . . .          314          2,351
    Deferred income taxes  (Note 8). . . . . . . . . . . . . . .          275            523
                                                                     --------      ---------
        Total current assets . . . . . . . . . . . . . . . . . .       32,854        125,968
 Property and equipment - net of accumulated
   depreciation  (Note 6). . . . . . . . . . . . . . . . . . . .        1,885         19,298
 Intangible assets - net of accumulated
      amortization of $650 and $1,833 at
        December 31, 1997 and 1998, respectively . . . . . . . .       14,409        102,884
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . .          773          1,830
                                                                     --------      ---------
         Total assets . . . .  . . . . . . . . . . . . . . . . .     $ 49,921      $ 249,980
                                                                     --------      ---------
                                                                     --------      ---------

               LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
    Line-of-credit  (Note 5) . . . . . . . . . . . . . . . . . .     $  8,040      $      --
    Accounts payable - trade . . . . . . . . . . . . . . . . . .       11,339         37,889
    Accrued expenses, payroll and income taxes . . . . . . . . .        2,441          6,447
    Notes payable relating to business combinations. . . . . . .        2,791             --
    Current portion of long-term debt  (Note 5). . . . . . . . .           55            298
                                                                     --------      ---------
        Total current liabilities  . . . . . . . . . . . . . . .       24,666         44,634
 Long-term debt (Note 5) . . . . . . . . . . . . . . . . . . . .          112        107,906
 Deferred income taxes  (Note 8) . . . . . . . . . . . . . . . .          112            246
                                                                     --------      ---------
        Total liabilities. . . . . . . . . . . . . . . . . . . .       24,890        152,786
                                                                     --------      ---------

 Commitments and contingencies (Note 13) . . . . . . . . . . . .           --             --  

 Stockholders' equity:
   Preferred stock, no par value; 5,000,000 shares
        authorized, none outstanding . . . . . . . . . . . . . .           --             --  
   Common stock, no par value;  30,000,000 shares
        authorized, 6,621,164 and 11,550,485 shares
        outstanding  at December 31, 1997 and
        December 31, 1998, respectively. . . . . . . . . . . . .           --             --  
   Additional paid-in capital. . . . . . . . . . . . . . . . . .       19,096         86,154
   Retained earnings . . . . . . . . . . . . . . . . . . . . . .        5,950         12,275
   Cumulative translation adjustment . . . . . . . . . . . . . .           --            310
   Unrealized loss on marketable securities. . . . . . . . . . .           --           (213)
   Treasury stock, at cost (shares 1997-1,800;
        1998-79,414) . . . . . . . . . . . . . . . . . . . . . .          (15)        (1,332)
                                                                     --------      ---------
          Total stockholders' equity . . . . . . . . . . . . . .       25,031         97,194
                                                                     --------      ---------
            Total liabilities and stockholders' equity . . . . .     $ 49,921      $ 249,980
                                                                     --------      ---------
                                                                     --------      ---------
</TABLE>


The accompanying notes are an integral part of these consolidated financial 
statements.


                                     21

<PAGE>

                      MIAMI COMPUTER SUPPLY CORPORATION
                       
                     CONSOLIDATED STATEMENT OF OPERATIONS
                 (Dollars in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                   Years Ended December 31,
                                                                   ------------------------
                                                               1996          1997          1998
                                                               ----          ----          ----
<S>                                                       <C>            <C>            <C>
Net sales . . . . . . . . . . . . . . . . . . . . . .     $   63,428     $  107,487     $  313,762

Cost of sales . . . . . . . . . . . . . . . . . . . .         52,061         88,190        246,670
                                                          ----------     ----------     ----------
Gross profit. . . . . . . . . . . . . . . . . . . . .         11,367         19,297         67,092

Selling, general and administrative
 expenses . . . . . . . . . . . . . . . . . . . . . .          8,891         15,441         53,389
Non-cash compensation expense . . . . . . . . . . . .            280             --             --
                                                          ----------     ----------     ----------

Operating income. . . . . . . . . . . . . . . . . . .          2,196          3,856         13,703
Interest expense. . . . . . . . . . . . . . . . . . .           (312)          (180)        (2,611)
Other income (expense). . . . . . . . . . . . . . . .            (11)            43            227
                                                          ----------     ----------     ----------

Income before income taxes. . . . . . . . . . . . . .          1,873          3,719         11,319
Provision for income taxes (Note 8) . . . . . . . . .            756          1,507          4,994
                                                          ----------     ----------     ----------

Net income. . . . . . . . . . . . . . . . . . . . . .     $    1,117     $    2,212     $    6,325
                                                          ----------     ----------     ----------
                                                          ----------     ----------     ----------

Earnings per share of common stock-  
   basic. . . . . . . . . . . . . . . . . . . . . . .     $     0.29     $     0.39     $     0.66
                                                          ----------     ----------     ----------
                                                          ----------     ----------     ----------
Earnings per share of common stock-  
   diluted. . . . . . . . . . . . . . . . . . . . . .     $     0.29     $     0.39     $     0.65
                                                          ----------     ----------     ----------
                                                          ----------     ----------     ----------

Weighted average number of common
   shares outstanding - basic . . . . . . . . . . . .      3,798,599      5,671,833      9,536,957
                                                          ----------     ----------     ----------
                                                          ----------     ----------     ----------

Weighted average number of common
   shares outstanding - diluted . . . . . . . . . . .      3,814,139      5,722,440      9,677,285
                                                          ----------     ----------     ----------
                                                          ----------     ----------     ----------
</TABLE>


The accompanying notes are an integral part of these consolidated financial 
statements.


                                       22
<PAGE>

                      MIAMI COMPUTER SUPPLY CORPORATION

                CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                           (Dollars in thousands)
<TABLE>
<CAPTION>
                                                                                                 Unrealized
                                                                 Additional            Treasury   loss on   Cumulative
                                          Shares      Treasury     paid-in  Retained    stock -  marketable translation    
                                        outstanding    shares      capital  earnings    at cost  securities adjustment   Total
                                        -----------    ------      -------  --------    -------  ---------- ----------   -----
<S>                                     <C>           <C>        <C>        <C>        <C>       <C>        <C>         <C>
Balance, December 31, 1995 . . . . .     3,582,000     (1,800)     $    25  $ 2,621    $   (15)     $  --        $ --   $ 2,631
                                                                                                         
Net income . . . . . . . . . . . . .                                          1,117                                       1,117
Compensation expense
  recognized . . . . . . . . . . . .                                   280                                                  280
Net proceeds from initial
  public offering. . . . . . . . . .     1,725,000                   7,794                                                7,794
Additional consideration
  DDP acquisition. . . . . . . . . .                                   250                                                  250
                                        ----------   --------      -------  -------    -------      -----        ----   -------
Balance, December 31, 1996 . . . . .     5,307,000     (1,800)       8,349    3,738        (15)        --          --    12,072

Net income . . . . . . . . . . . . .                                          2,212                                       2,212
Shares issued in connection
  with business combinations . . . .     1,314,164                  10,747                                               10,747
                                        ----------   --------      -------  -------    -------      -----        ----   -------

Balance, December 31, 1997 . . . . .     6,621,164     (1,800)      19,096    5,950        (15)        --          --    25,031

Net income . . . . . . . . . . . . .                                          6,325                                       6,325
Purchases of treasury shares . . . .                 (428,466)                          (7,593)                          (7,593)
Shares issued in connection
  with business combinations . . . .     2,514,321    333,266       31,323               5,962                           37,285
Net proceeds from secondary
  offering of common stock . . . . .     2,415,000                  35,762                                               35,762
Transactions involving
  employee stock purchase
  plans, net . . . . . . . . . . . .                   17,586          (27)                314                              287
Unrealized loss on marketable
  securities . . . . . . . . . . . .                                                                 (213)                 (213)
Cumulative translation
  adjustment . . . . . . . . . . . .                                                                              310       310
                                        ----------   --------      -------  -------    -------      -----        ----   -------

Balance, December 31, 1998 . . . . .    11,550,485   (79 ,414)     $86,154  $12,275    $(1,332)     $(213)       $310   $97,194
                                        ----------   --------      -------  -------    -------      -----        ----   -------
                                        ----------   --------      -------  -------    -------      -----        ----   -------
</TABLE>


                      MIAMI COMPUTER SUPPLY CORPORATION

                CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                           (Dollars in thousands)

<TABLE>
<CAPTION>
                                                                              Years Ended December 31,
                                                                              ------------------------
                                                                            1996        1997        1998
                                                                            ----        ----        ----
<S>                                                                     <C>          <C>         <C>
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   $     1,117  $   2,212   $    6,325

Other comprehensive income:
  Cumulative translation adjustment . . . . . . . . .                            --         --          310
  Unrealized loss on marketable securities . . . .                               --         --         (213)
                                                                        -----------  ---------   ----------

Comprehensive income . . . . . . . . . . . . . . . . . . . .            $     1,117  $   2,212   $    6,422
                                                                        -----------  ---------   ----------
                                                                        -----------  ---------   ----------
</TABLE>


The accompanying notes are an integral part of these consolidated financial 
statements.


                                       23
<PAGE>

                         MIAMI COMPUTER SUPPLY CORPORATION

                        CONSOLIDATED STATEMENT OF CASH FLOWS
                                (Dollars in thousands)

<TABLE>
<CAPTION>
                                                                                                     Years Ended December 31,
                                                                                                     ------------------------
                                                                                                  1996         1997        1998
                                                                                                  ----         ----        ----
<S>                                                                                            <C>          <C>         <C>
Cash flows from operating activities:
    Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $    1,117   $    2,212  $    6,325
    Adjustments to reconcile net income to cash provided by (used in)
       operating activities:
       Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        328          545       2,439
       Non-cash compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        280           --          --  
       Non-cash compensation to former Diversified Data Products,
         Inc. owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         59           --          --  
       Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         32          (22)        276
       Changes in assets and liabilities, net of effects of
          business combinations:
       Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     (2,637)      (4,351)    (11,980)
          Inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     (1,594)        (228)     (2,158)
          Prepaid expenses, other assets and deposits. . . . . . . . . . . . . . . . . . . . .       (273)         221         (18)
          Accounts payable - trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      1,341        1,177       3,412
          Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         64          158        (254)
                                                                                               ----------   ----------  ----------

          Cash used in operating activities. . . . . . . . . . . . . . . . . . . . . . . . . .     (1,283)        (288)     (1,958)
                                                                                               ----------   ----------  ----------

Cash flows from investing activities:
    Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       (511)        (579)     (6,645)
    Investment in other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       (152)        (157)       (139)
    Business combinations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         --       (4,284)    (92,353)
    Cash included in business combinations . . . . . . . . . . . . . . . . . . . . . . . . . .        109        1,008         762
                                                                                               ----------   ----------  ----------

    Cash used in investing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . .       (554)      (4,012)    (98,375)
                                                                                               ----------   ----------  ----------

Cash flows from financing activities:
    Proceeds from public offering. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      7,794           --      35,762
    Borrowings under line-of-credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     13,578       19,078     130,872
    Payments under line-of-credit  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    (18,610)     (11,038)    (35,762)
    Repayment of debt acquired in business combinations. . . . . . . . . . . . . . . . . . . .         --       (2,883)    (21,700)
    Purchase of treasury shares, net of re-issuance. . . . . . . . . . . . . . . . . . . . . .         --           --      (7,306)
    Increase (decrease) in long-term debt. . . . . . . . . . . . . . . . . . . . . . . . . . .       (146)          25         680
                                                                                               ----------   ----------  ----------

      Cash provided by financing activities. . . . . . . . . . . . . . . . . . . . . . . . . .      2,616        5,182     102,546
                                                                                               ----------   ----------  ----------

Effect of exchange rates on cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         --           --         239
                                                                                               ----------   ----------  ----------

Net increase in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . .        779          882       2,452
Cash and cash equivalents - beginning of year. . . . . . . . . . . . . . . . . . . . . . . . .          2          781       1,663
                                                                                               ----------   ----------  ----------
Cash and cash equivalents - end of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . $      781   $    1,663  $    4,115
                                                                                               ----------   ----------  ----------
                                                                                               ----------   ----------  ----------

Supplemental cash flow information:
    Income taxes paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $    1,007   $    1,485  $    4,581
    Interest paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $      325   $      209  $    2,196
    Common stock issued in business combinations . . . . . . . . . . . . . . . . . . . . . . . $       --   $   10,747  $   37,285
    Debt issued in business combinations . . . . . . . . . . . . . . . . . . . . . . . . . . . $       --   $    2,791  $       --
</TABLE>


          The accompanying notes are an integral part of these 
                     consolidated financial statements.
                                    24
<PAGE>

                    MIAMI COMPUTER SUPPLY CORPORATION

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              (Dollars in thousands, except per share data)

NOTE 1.  ORGANIZATION AND OPERATIONS

     Miami Computer Supply Corporation (the "Company") operates in one business
segment and sells a wide variety of computer supplies and audio-visual
presentation products to corporate customers, governmental agencies,
universities, hospitals and, to a lesser extent, computer supply dealers
throughout the United States and Canada.  In 1998, revenue was $279,849 and
$15,913 in the United States and Canada, respectively.  At December 31, 1998,
long-lived assets were $87,600 and $16,749 in the United States and Canada,
respectively.  Prior to 1998, substantially all of the Company's operations were
conducted in the United States.  

     Credit risk with respect to trade accounts receivable is generally
diversified due to the large number of entities comprising the Company's
customer base.  Management establishes policies with respect to credit risks and
monitors compliance with those policies.  No single customer accounted for more
than 10% of consolidated sales for any period represented.

     Effective May 30, 1996, Pittsburgh Investment Group LLC ("LLC") acquired 70
percent of the outstanding shares of the Company for $4,000 in cash and $4,000
in promissory notes.  Concurrent with this acquisition, LLC also acquired from
third parties 100 percent of the outstanding common stock of Diversified Data
Products, Inc., a Michigan corporation ("DDP") and contributed its stock in DDP
to the Company.  See Note 3 to these Consolidated Financial Statements.  
     
NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

CONSOLIDATION

     All subsidiaries of the Company are wholly-owned and are included in the
consolidated financial statements.  All significant intercompany accounts and
transactions have been eliminated.

Foreign Currencies

     The financial statements of the Company's Canadian subsidiary, whose
functional currency is the Canadian dollar, are translated to U.S. dollars at
period end exchange rates for assets and liabilities and at weighted average
exchange rates for results of operations.  The resulting translation gains or
losses are accumulated in a separate component of stockholders' equity. 

     Forward foreign currency contracts are used to manage currency risks
relating to existing assets or liabilities and purchase commitments denominated
in a foreign currency.  Gains or losses are recognized at the time the asset,
liability or purchase commitments are closed.  Net contract values are included
in receivables or payables as appropriate.  The fair value of forward contracts
at December 31, 1998 and 1997 was not material.

CASH AND CASH EQUIVALENTS

     Cash and cash equivalents include cash on hand and on deposit and highly
liquid debt instruments with maturities of three months or less.  Cash
equivalents are carried at cost, which approximates fair value.

REVENUE RECOGNITION

     Revenues from the sale of products are recognized upon shipment.

INVENTORIES

     Inventories are stated at the lower of cost or market; cost is determined
using the weighted average method.  Inventories consist primarily of products
held for resale.



                                       25
<PAGE>

                        MIAMI COMPUTER SUPPLY CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                  (Dollars in thousands, except per share data)

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED)

PROPERTY, EQUIPMENT AND CAPITAL LEASES

     Property, equipment and assets held under capital leases are recorded at
cost.  Depreciation and amortization are provided using the straight-line method
over the estimated useful lives of the assets.  Depreciation and amortization
periods are as follows:

<TABLE>
<CAPTION>
                                                                           Estimated
                                                                         useful lives
                                                                         ------------
                <S>                                                      <C>
                Buildings. . . . . . . . . . . . . . . . . . . . . . .       30 years
                Furniture and fixtures . . . . . . . . . . . . . . . .   5 to 7 years
                Equipment. . . . . . . . . . . . . . . . . . . . . . .   3 to 7 years
                Leasehold improvements . . . . . . . . . . . . . . . .   3 to 5 years
                Transportation equipment . . . . . . . . . . . . . . .        5 years
</TABLE>

     The cost of properties retired or otherwise disposed of, together with the
accumulated depreciation provided thereon, is eliminated from the accounts.  Any
net gain or loss is recognized in income.

INTANGIBLE ASSETS

     The Company assesses impairment of assets on a periodic basis using a
discounted cash flow approach.  If appropriate, impairment would be recognized
based upon the provisions of Statement of Financial Accounting Standards
("SFAS") No. 121  "Accounting for the Impairment of Long Lived Assets and for
Long Lived Assets to Be Disposed Of" or Accounting Principles Board Opinion No.
17, "Accounting for Intangible Assets."

INCOME TAXES

     Income taxes are recognized during the year in which transactions enter
into the determination of financial statement income.  Deferred tax assets and
liabilities are recognized for the future tax consequences of temporary
differences between the book carrying amounts and the tax basis of assets and
liabilities.

EARNINGS PER SHARE

     Basic earnings per share is computed by dividing net income by the weighted
average number of common shares outstanding during the period.  Diluted earnings
per share is computed by dividing net income by the weighted average number of
common shares outstanding plus all potentially dilutive common share equivalents
outstanding during the period.  Dilutive common shares are determined using the
treasury stock method.

ADVERTISING COSTS

     Costs of advertising are expensed as incurred.

FAIR VALUE OF FINANCIAL INSTRUMENTS

     The following methods were used by the Company in estimating its fair value
disclosures for financial instruments:

          CASH AND DEPOSITS, ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE - The
          carrying amount reported in the balance sheet approximate fair value.
                                                                         
          FOREIGN CURRENCY EXCHANGE CONTRACTS - The fair value of the Company's
          foreign exchange contracts is estimated based on quoted market prices
          of comparable contracts. 


                                      26
<PAGE>

                        MIAMI COMPUTER SUPPLY CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                  (Dollars in thousands, except per share data)

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED)

          AVAILABLE-FOR-SALE MARKETABLE SECURITIES - Marketable equity
          securities with a market value of $365 and a cost basis of $578 are
          included within other assets of the accompanying balance sheet at
          December 31, 1998.  The fair value of available-for-sale marketable
          securities is obtained from quoted market prices.  These securities
          are marked-to-market on the balance sheet with the resulting
          unrealized gains or losses recorded as a separate component of
          stockholders' equity and other comprehensive income.  Realized gains
          or losses are recorded in the Statement of Operations when realized. 
          Deferred income taxes with respect to these items are not material.

          SHORT- AND LONG-TERM DEBT - The carrying amounts of the Company's
          borrowings approximate their fair value by virtue of the variable
          interest rates associated with these instruments.

USE OF ESTIMATES

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting periods.  Actual results could differ from those estimates.

NOTE 3.  ACQUISITIONS

     The Company is engaged in an active acquisition program to acquire
companies engaged in the computer supply and audio-visual presentation products
industry.  During 1998, the Company acquired nine such entities, all in purchase
business combinations.  Earnings of each of the acquired entities have been
recorded by the Company beginning with the respective acquisition dates.  The
aggregate purchase price of the acquired entities of $129,638 was comprised of
$90,502 in cash, 2,847,587 shares of the Company's common stock with a fair
value of $37,285 and related out of pocket expenses totaling $1,851.  

     During 1997, the Company acquired six such entities all in purchase
business combinations.  Earnings of each of the acquired entities have been
recorded by the Company beginning with the respective acquisition dates.  The
aggregate purchase price of the acquired entities of $17,821 was comprised of
$3,497 in cash, 1,314,164 shares of the Company's common stock with a fair value
of $10,747, notes payable due to sellers aggregating $2,791 due in January, 1998
(which were paid at maturity), and related out of pocket expenses totaling $786.
One acquisition calls for contingent consideration of up to $2,200 if certain
operating results occur within the thirty-three month period following the
acquisition.

     The acquisition price of all of these transactions has been allocated to
the estimated fair value of the assets acquired and the liabilities assumed,
with the residual being allocated to intangible assets (goodwill) which is being
amortized over a forty year life, as summarized in the following table:

<TABLE>
<CAPTION>
                                                                       1997                1998
                                                                   Acquisitions        Acquisitions
                                                                   ------------        ------------
          <S>                                                      <C>                 <C>
          Cash. . . . . . . . . . . . . . . . . . . . . . . . . .  $      1,008        $        762
          Accounts receivable . . . . . . . . . . . . . . . . . .         8,503              45,400
          Inventories . . . . . . . . . . . . . . . . . . . . . .         2,989              28,839
          Deferred income taxes . . . . . . . . . . . . . . . . .           167                 390
          Property and equipment. . . . . . . . . . . . . . . . .           657              12,024
          Other assets. . . . . . . . . . . . . . . . . . . . . .           155               3,076
          Payables and accruals . . . . . . . . . . . . . . . . .        (6,946)            (27,398)
          Debt. . . . . . . . . . . . . . . . . . . . . . . . . .        (2,883)            (23,113)
          Goodwill. . . . . . . . . . . . . . . . . . . . . . . .        14,171              89,658
                                                                   ------------        ------------
                 Purchase price . . . . . . . . . . . . . . . . .  $     17,821        $    129,638
                                                                   ------------        ------------
                                                                   ------------        ------------
</TABLE>


                                       27
<PAGE>

                         MIAMI COMPUTER SUPPLY CORPORATION

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                   (Dollars in thousands, except per share data)

NOTE 3.  ACQUISITIONS - (CONTINUED)

     The following unaudited pro forma financial information reflects the effect
of the acquisitions described in the preceding paragraphs assuming each
acquisition had occurred at the beginning of the period shown:

<TABLE>
<CAPTION>
                                                                 Years Ended December 31,
                                                                 ------------------------
                                                               1997                    1998
                                                               ----                    ----
          <S>                                            <C>                     <C>
          Net sales . . . . . . . . . . . . . . . . .    $        494,413        $        599,217
                                                         ----------------        ----------------
                                                         ----------------        ----------------

          Net income (loss) . . . . . . . . . . . . .    $            (41)       $          6,162
                                                         -----------------       ----------------
                                                         -----------------       ----------------

          Earning per share of common stock-
             basic. . . . . . . . . . . . . . . . . .    $             --        $           0.60
                                                         ----------------        ----------------
                                                         ----------------        ----------------

          Earnings per share of common stock -
             diluted . . . . . .  . . . . . . . . . .    $             --        $           0.59
                                                         ----------------        ----------------
                                                         ----------------        ----------------
</TABLE>

     The purchase allocation of the acquisitions completed in 1998 are subject
to finalization of pre-existing contingencies and other purchase accounting
adjustments, none of which are expected to be material. 

     Effective May 30, 1996, LLC contributed its stock in DDP to the Company. 
The acquisition of DDP by the Company was accounted for using the purchase
method of accounting and accordingly the purchase price has been allocated based
upon the fair value of the assets acquired and liabilities assumed as of May 30,
1996.

     In connection with the acquisition of DDP, LLC issued a loan to certain
former stockholders in an amount of $250.  This amount was subject to
forgiveness based upon DDP generating specified income levels for the period May
30, 1996 to December 31, 1996.  DDP generated such income levels for this
period, and accordingly the loan was forgiven.  The value of the assets acquired
was adjusted to reflect this additional consideration.  

     The purchase price of DDP was allocated as follows:

<TABLE>
              <S>                                                  <C>
              Cash. . . . . . . . . . . . . . . . . . . . . . . .  $           109
              Accounts receivable . . . . . . . . . . . . . . . .            1,153
              Inventories . . . . . . . . . . . . . . . . . . . .            1,328
              Other assets. . . . . . . . . . . . . . . . . . . .               79
              Goodwill. . . . . . . . . . . . . . . . . . . . . .              250
                                                                   ---------------

                   Purchase price . . . . . . . . . . . . . . . .  $         2,919
                                                                   ---------------
                                                                   ---------------
</TABLE>

     Goodwill recorded in connection with this acquisition is being amortized on
a straight-line basis over 40 years.

<TABLE>
<CAPTION>
NOTE 4.  ACCOUNTS RECEIVABLE                                           DECEMBER 31,
                                                                       ------------
                                                                1997                 1998
                                                                ----                 ----
            <S>                                            <C>                 <C>
            Trade customers . . . . . . . . . . . . . . .  $      20,450       $        75,510
            Rebates due from suppliers. . . . . . . . . .            980                 2,951
            Other . . . . . . . . . . . . . . . . . . . .            280                 1,086
            Less - allowance for doubtful
               accounts . . . . . . . . . . . . . . . . .           (220)                 (677)
                                                           --------------      ----------------
                                                           $      21,490       $        78,870
                                                           -------------       ---------------
                                                           -------------       ---------------
</TABLE>

                                      28
<PAGE>


                         MIAMI COMPUTER SUPPLY CORPORATION

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                   (Dollars in thousands, except per share data)

NOTE 5.  BORROWING ARRANGEMENTS

     The following is a summary of the Company's borrowings:

<TABLE>

                                                                  December 31,
                                                                  ------------
                                                              1997           1998
                                                              ----           ----
<S>                                                        <C>           <C>
Short-term line-of-credit . . . . . . . . . . . . . . .    $  8,040      $       --
                                                           --------      ----------
                                                           --------      ----------
Long-term line-of-credit. . . . . . . . . . . . . . . .    $     --      $  103,150
Capitalized lease obligations (See Note 9)  . . . . . .         167           4,798
Other . . . . . . . . . . . . . . . . . . . . . . . . .          --             256
Less current portion . . . . . . . . . .  . . . . . . .          55             298
                                                           --------      ----------
                   Total long-term debt . . . . . . . .    $    112      $  107,906
                                                           --------      ----------
                                                           --------      ----------

</TABLE>

     During 1997 and throughout most of 1998, the Company financed its 
operations under lines of credit offered by several banks on terms similar to 
those described below.  On December 10, 1998, the Company revised its then 
existing lending arrangements with a consortium of banks.  An amended and 
restated credit facility of $125.0 million was provided by PNC Bank, N.A. and 
four other banks and matures on December 10, 2003.  The credit facility 
enables the Company to borrow funds and repay funds during the term of the 
agreement and contains restrictive covenants which include, among other 
restrictions: (i) the maintenance of certain financial ratios; (ii) 
restrictions on (a) the purchase or sale of assets, (b) any merger, sale or 
consolidation activity, (c) loans, investments and guarantees made by the  
Company, (d) lease and sale and leaseback transactions, and (e) capital 
expenditures; and (iii) certain limitations on the incurrence of other 
indebtedness.  In addition, the credit facility prohibits the payment of 
dividends and certain repurchases of the Company's common stock.  The Credit 
Facility is collateralized by substantially all of the Company's assets.  The 
interest rate for the credit facility is based upon either the LIBOR rate 
plus a variable spread (1.5% at December 31, 1998) or the prime rate (7.75% 
at December 31, 1998).

NOTE 6.  PROPERTY AND EQUIPMENT

     Property and equipment consists of the following:
<TABLE>
<CAPTION>
                                                                 December 31
                                                                 -----------
                                                           1997                1998
                                                       ----------         --------------
 <S>                                                   <C>                <C>
 Buildings . . . . . . . . . . . . . . . . . .         $       --         $        4,484
 Furniture and fixtures  . . . . . . . . . . .                804                  3,824
 Equipment . . . . . . . . . . . . . . . . . .              1,939                 12,854
 Leasehold improvements  . . . . . . . . . . .                175                  1,577
 Transportation equipment  . . . . . . . . . .                393                  1,027
                                                       ----------         --------------
                                                            3,311                 23,766
 Less - accumulated depreciation . . . . . . .              1,426                  4,468
                                                       ----------         --------------
                                                       $    1,885         $       19,298
                                                       ----------         --------------
                                                       ----------         --------------
</TABLE>

NOTE 7.  EMPLOYEE BENEFIT PLANS 

     The Company's employee benefit plans are defined contribution plans and 
include employee savings plans  and profit sharing plans.  Savings plans 
cover substantially all employees and include Company matches to employee 
contributions limited to a percent of the employee's compensation.  The 
profit sharing plans cover employees (excluding sales personnel, officers of 
the Company and employees of the Company's subsidiaries) who meet certain 
minimum employment requirements.  Expenses under these plans were $110, $140 
and $256 for the years ended December 31, 1996, 1997 and 1998, respectively.


                                        29

<PAGE>


                         MIAMI COMPUTER SUPPLY CORPORATION

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                   (Dollars in thousands, except per share data.)

NOTE 8.  INCOME TAXES 

     The components of pre-tax income of the Company consists of the following:

<TABLE>
<CAPTION>
                                                                                 Year Ended December 31,
                                                                                 -----------------------
                                                                1996                       1997                      1998
                                                        -----------------          ----------------            --------------
 <S>                                                    <C>                        <C>                         <C>
 Domestic. . . . . . . . . . . . . . . . . . . . .      $           1,873          $          3,719            $       10,790
 Foreign . . . . . . . . . . . . . . . . . . . . .                     --                        --                       529
                                                        -----------------          ----------------            --------------
 Total . . . . . . . . . . . . . . . . . . . . . .      $           1,873          $          3,719            $       11,319
                                                        -----------------          ----------------            --------------
                                                        -----------------          ----------------            --------------
</TABLE>

     The provision (benefit) for taxes on income consists of the following:

<TABLE>
<CAPTION>
                                                   Year Ended December 31,
                                                   -----------------------
                                           1996              1997              1998
                                           ----              ----              ----
<S>                                      <C>             <C>                <C>
 Current:
    Federal . . . . . . . . . . . . .    $    570        $     1,252        $   3,660
    State . . . . . . . . . . . . . .         154                277              831
 Foreign. . . . . . . . . . . . . . .          --                 --              227
                                         --------        -----------        ---------
          Total . . . . . . . . . . .         724              1,529            4,718
                                         --------        -----------        ---------
 Deferred:
     Federal . . . . . . . . . . . . .         23                (21)             247
     State . . . . . . . . . . . . . .          9                 (1)              29
                                         --------        -----------        ---------
          Total. . . . . . . . . . . .         32                (22)             276
                                         --------        -----------        ---------
            Total tax provision. . . .   $    756        $     1,507        $   4,994
                                         --------        -----------        ---------
                                         --------        -----------        ---------

</TABLE>

     Deferred tax assets and liabilities comprise the following:

<TABLE>
<CAPTION>
                                                              December 31,
                                                              ------------
                                                         1997            1998
                                                         ----            ----
<S>                                                      <C>             <C>
Deferred tax assets:
    Reserves and accruals not yet deductible. . .      $     85       $    238
    Inventory . . . . . . . . . . . . . . . . . .           146            236
    State tax accruals. . . . . . . . . . . . . .            31             49
      Other . . . . . . . . . . . . . . . . . . .            13             --
                                                       --------        -------
          Total deferred tax assets . . . . . . .           275            523
                                                       --------        -------
Deferred tax liabilities:
    Fixed assets and depreciation . . . . . . . .          (108)          (202)
    Intangibles . . . . . . . . . . . . . . . . .            (2)           (44)
      Other . . . . . . . . . . . . . . . . . . .            (2)            --
                                                       --------        -------
          Total deferred tax liabilities. . . . .          (112)          (246)
                                                       --------        -------
            Net deferred taxes  . . . . . . . . .         $ 163           $277
                                                       --------        -------
                                                       --------        -------
</TABLE>


                                           30

<PAGE>

                    MIAMI COMPUTER SUPPLY CORPORATION

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                   (Dollars in thousands, except per share data)

NOTE 8.  INCOME TAXES - (CONTINUED)
     
     A reconciliation of the federal statutory tax rate to the Company's
effective tax rate is as follows:
<TABLE>
<CAPTION>
                                                                          Year Ended December 31,
                                                                          -----------------------
                                                                 1996              1997              1998
                                                                 ----              ----              ----
  <S>                                                          <C>              <C>               <C>
  U.S. federal statutory rate
   applied to income before tax.  . . . . . . . .              $    637         $   1,264         $   3,848
  State income taxes,
     net of federal income tax effect . . . . . .                   105               183               568
 Non-deductible goodwill amortization  . .                            1                25               402
 Other permanent differences . . . . . . . . . .                     13                13                81
   Foreign taxes in excess of U.S. 
 statutory rate. . . . . . . . . . . . . . . . . . .                 --                --                47
 Other. . . . . . . . . . . . . . . . . . . . . . .                  --                22                48
                                                                -------         ---------          --------
                                                                $   756         $   1,507          $  4,994
                                                                -------         ---------          --------
                                                                -------         ---------          --------
</TABLE>

NOTE 9.  LEASES

     The Company leases office space, the substantial majority of which are 
leased from related parties comprising certain shareholders and former owners 
of acquired entities, under various operating and capital leases.  Lease 
terms range from 1 to 27 years.  Operating leases which expire are generally 
renewed or replaced by similar leases and renewal options.  The total rental 
expense under operating leases amounted to $371, $797 and $3,038 for the 
years ended December 31, 1996, 1997 and 1998, respectively.

     Following is a summary of future minimum rental payments with respect to 
leases that have initial or remaining noncancelable lease terms in excess of 
one year at December 31, 1998:
<TABLE>
<CAPTION>

                                                                                       Capitalized            Operating
 Year Ending December 31,                                                                 leases                leases
                                                                                         --------              --------
 <S>                                                                                     <C>                  <C>
       1999. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         $     791            $    2,816
       2000 . . .  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               841                 2,128
       2001  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               772                 1,799
       2002  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               528                 1,452
       2003  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               528                   912
       Later years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            11,418                 2,110
                                                                                         ---------             ----------
 Total minimum lease payments. . . . . . . . . . . . . . . . . . . . . . . . . .            14,878             $  11,217
                                                                                                               ----------
                                                                                                               ----------

 Imputed interest  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            10,080
                                                                                         ---------

 Present value of minimum
 capitalized lease payments .. . . . . . . . . . . . . . . . . . . . . . . . . .             4,798
 Current portion  . .  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              (231)
                                                                                         ---------
  Long-term capitalized lease
    obligations .  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         $   4,567
                                                                                         ---------
                                                                                         ---------
</TABLE>

NOTE 10.  STOCKHOLDERS' EQUITY

     On  June 30, 1998, the Company completed a secondary offering of 
2,415,000 shares of Common Stock (including an underwriters' overallotment 
option of 315,000 shares) to the public at $16 per share.  Net proceeds to 
Company after deducting underwriting fees and expenses was $35,762.  The 
proceeds were used to repay outstanding indebtedness under the Company's 
borrowing arrangements and other corporate purposes.

     On November 15, 1996, the Company completed an initial public offering 
of 1,725,000 shares of common stock (including an underwriters' overallotment 
option of 225,000 shares) to the public at a price of $5.67 per share.  Net 
proceeds to the Company after deducting underwriting fees and expenses 
amounted to $7,794.  The proceeds were used to repay outstanding indebtedness 
under the Company's borrowing arrangements and for other corporate purposes.  


                                     31

<PAGE>

                        MIAMI COMPUTER SUPPLY CORPORATION

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                   (Dollars in thousands, except per share data.)

NOTE 10. STOCKHOLDERS' EQUITY - (CONTINUED)

     In connection with the purchase of DDP by LLC, LLC agreed to provide the 
three selling stockholders of DDP a stock incentive so long as such 
stockholders remained employees of the Company. LLC agreed to transfer a 
total of 58,520 shares of the Company's common stock owned by LLC to the 
employees over three year period ending December 31, 1998. However, upon the 
initial public offering of the Company's common stock, all such shares 
vested. The market value of the stock award was recognized as compensation 
expense at the initial public offering date.

NOTE 11.  STOCK OPTION AND PURCHASE PLANS

     EMPLOYEE INCENTIVE STOCK OPTION PLANS
     The Employee Incentive Stock Option Plans authorize the granting of 
options to purchase up to 1,125,000 shares of common stock to eligible 
officers and key employees at not less than the market value on the date the 
options are granted. The option period may not exceed ten years from the date 
of grant.  Vesting periods are determined by the Compensation Committee of 
the Board of Directors and are generally three years. 

     The following table summarizes activity in these stock option plans in 
numbers of shares:
<TABLE>
<CAPTION>
                                                                                    Years Ended December 31,
                                                                                    ------------------------
                                                                               1996           1997           1998
                                                                               ----           ----           ----
         <S>                                                                   <C>          <C>             <C>
         Outstanding, beginning balance. . . . . . . . . . .                    --          166,500         205,650
         Granted . . . . . . . . . . . . . . . . . . . . . .                166,500         77,400          634,500
         Expired . . . . . . . . . . . . . . . . . . . . . .                    --          (38,250)           --
                                                                           --------       ---------         --------
         Outstanding, ending balance . . . . . . . . . . . .                166,500         205,650          840,150
                                                                           --------       ---------         --------
                                                                           --------       ---------         --------
     </TABLE>

     At December 31, 1998, outstanding stock options were exercisable at the 
following price ranges per share:  $5.67-$6.83 (205,650 shares), $9.17-$9.33 
(235,876 shares) and $16.25-$20.38 (398,624 shares).

     NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
     The Non-employee Directors Stock Option Plan (the "Directors Plan") 
authorized the granting of options to purchase a total of 100,000 shares of 
common stock.

     The Directors Plan authorized the granting of options to purchase 15,000 
shares of common stock to each director who is not an employee of the Company 
at the first annual meeting of shareholders following the Company's initial 
public offering at not less than the market value on the date the options are 
granted. During 1997, options to purchase of 45,000 shares were issued at 
$10.25 per share.  The option period may not exceed ten years from the date 
of grant.  The options vest ratably over a three year period.  No options 
under this Plan have been exercised.

     Additionally, the Directors Plan authorized the granting of options to 
purchase 5,000 shares of common stock, not to exceed 15,000, shares for any 
non-employee director elected subsequent to the first annual meeting of 
shareholders.  Any options granted subsequent to the initial meeting of 
shareholders vest ratably over a three year period.  

     ACCOUNTING FOR STOCK AWARDS AND STOCK OPTIONS
     In October 1995, SFAS No. 123, "Accounting for Stock-Based Compensation" 
was issued.  As permitted by the standard, the Company has elected to 
continue to follow existing accounting guidance, Accounting Principles Board 
Opinion No. 25 and related interpretations ("APB No. 25"), for stock based 
compensation. SFAS No. 123 requires companies electing to follow existing 
accounting rules to disclose the pro forma effects as if the fair value based 
method of accounting called for by SFAS No. 123 had been applied.    

     The weighted average fair value per share of stock options granted 
during 1996 was $2.63, in 1997 was $3.72 and in 1998 was $7.39.  The fair 
value of the options were estimated on the date of grant using the 
Black-Scholes option pricing model with the following assumptions used for 
grants issued in 1996, 1997and 1998, respectively:  dividend yield of 0%, 
expected volatility of 50.0%, 53.7% and 41.97%; risk-free interest rate of 
6.5%, 7.5% and 5.9%; and expected lives of five years.  Had compensation cost 
for the Company's stock based compensation plans been determined based on the 
fair value at the grant dates 



                                    32

<PAGE>

                         MIAMI COMPUTER SUPPLY CORPORATION

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                   (Dollars in thousands, except per share data.)

NOTE 11.  STOCK OPTION AND PURCHASE PLANS - (CONTINUED)

consistent with the provisions of SFAS No. 123, the Company's net income and 
earnings per common share for 1997 and 1998 would have been reduced to the 
pro forma amounts indicated below (amounts for 1996 are not material):
<TABLE>
<CAPTION>
                                                                        1997      1998
                                                                        ----      ----
          <S>                                                          <C>       <C>
          Net income - as reported . . . . . . . . . . . . . . . . .   $2,212    $6,325
                                                                       ------    ------
                                                                       ------    ------
          Pro forma net income . . . . . . . . . . . . . . . . . . .   $2,091    $5,717
                                                                       ------    ------
                                                                       ------    ------
          Earnings per common share - basic, as reported . . . . . .    $0.39     $0.66
                                                                       ------    ------
                                                                       ------    ------
          Earnings per common share - diluted, as reported . . . . .    $0.39     $0.65
                                                                       ------    ------
                                                                       ------    ------
          Pro forma earning per common share - basic . . . . . . . .    $0.37     $0.60
                                                                       ------    ------
                                                                       ------    ------
          Pro forma earnings per common share - diluted. . . . . . .    $0.37     $0.59
                                                                       ------    ------
                                                                       ------    ------
</TABLE>

EMPLOYEE STOCK PURCHASE PLAN.
           In 1998, the Company initiated a non-compensatory employee stock 
purchase plan ("ESPP") available to all employees.  The ESPP enables 
employees to purchase stock at 91% of its fair value on the date of purchase.

NOTE 12.  BASIC AND DILUTED EARNINGS PER COMMON SHARE

           The only dilutive securities of the Company relate to stock 
options. The computation of basic and diluted earnings per common share is 
shown below:

<TABLE>
<CAPTION>

                                                  1996                           1997                          1998
                                                  ----                           ----                          ----
                                        Income           Shares        Income          Shares        Income           Shares
                                      (Numerator)    (Denominator)   (Numerator)   (Denominator)   (Numerator)    (Denominator)
                                      -----------     -----------   -------------   -----------   -------------    -------------
<S>                                   <C>             <C>           <C>             <C>           <C>              <C>
 Income available to
    common stockholders . . . . .     $    1,117       3,798,599    $      2,212     5,671,833    $      6,325        9,536,957
                                      ----------                    ------------                  ------------
 Effect of dilutive securities. .                         15,540                        50,607                          140,328
                                                      ----------                    ----------                       ----------

 Income available to common
    stockholders plus assumed
       conversion . . . . . . . .     $    1,117       3,814,139    $      2,212     5,722,440    $      6,325         9,677,285
                                      ----------     -----------    ------------    ----------    ------------        ----------
 Basic earnings per common 
    share . . . . . . . . . . . .                    $      0.29                    $     0.39                        $     0.66
                                                     -----------                    ----------                        ----------
                                                     -----------                    ----------                        ----------
 Diluted earnings per common
    share . . . . . . . . . . . .                    $      0.29                    $     0.39                        $     0.65
                                                     -----------                    ----------                        ----------
                                                     -----------                    ----------                        ----------
</TABLE>


           All stock options outstanding at December 31, 1996, December 31, 
1997 and December 31, 1998 were included in the computation of diluted 
earnings per common share for the years ended December 31, 1996, 1997 and 
1998, respectively.

Note 13. COMMITMENTS AND CONTINGENCIES

           In the normal course of business the Company is subject to claims, 
both asserted and unasserted.  Based on information presently available at 
December 31, 1998, Management did not believe that any of these issues would 
have a material effect on the Company's financial position and results of 
operations.


                                     33


<PAGE>

                         MIAMI COMPUTER SUPPLY CORPORATION
                                          
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                   (Dollars in thousands, except per share data)

NOTE 14.  SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED):
           The following table sets forth selected quarterly financial data for
1997 and 1998.

<TABLE>
<CAPTION>


1997                                           1ST QUARTER    2ND QUARTER   3RD QUARTER     4TH QUARTER
----                                         -------------    -----------   -----------     -----------

<S>                                            <C>            <C>           <C>             <C>
Net sales   . . . . . . . . . . . . . . . .       $20,226        $22,124       $29,001         $36,135
                                                                                                                     
Cost of sales  . . . . . . .  . . . . . . .        16,745         18,263        23,608          29,574
                                            -------------    -----------   -----------     -----------
Gross profit . .. . . . . . . . . . . . . .         3,481          3,861         5,393           6,561
Selling, general and administrative 
  expenses. . . . . . . . . . . . . . . . .         2,717          3,040         4,364           5,319
                                            -------------    -----------   -----------     -----------
Operating income . . . .  . . . . . . . . .           764            821         1,029           1,242
Interest expense  . . . . . . . . . . . . .            (1)           (24)          (51)           (104)
Other income . . . . . . . . . . .  . . . .            12             15             2              14
                                            -------------    -----------   -----------     -----------

Income before income taxes  . . . . . . . .           775            812           980           1,152
Provision for income taxes . . .  . . . . .           314            329           406             458
                                            -------------    -----------   -----------     -----------
Net income . . . .  . . . . . . . . . . . .          $461           $483          $574            $694
                                            -------------    -----------   -----------     -----------
                                            -------------    -----------   -----------     -----------
Earnings per share of common stock
  (basic and diluted) . . . . . . . . . . .         $0.09          $0.09         $0.10           $0.11
                                            -------------    -----------   -----------     -----------
                                            -------------    -----------   -----------     -----------
Weighted average number of common
 shares outstanding . . . . . . . . . . . .     5,307,000      5,413,968     5,893,077       6,106,328
                                            -------------    -----------   -----------     -----------
                                            -------------    -----------   -----------     -----------

Weighted average number of common
shares outstanding-diluted  . . . . . . . .     5,341,850      5,446,659     5,923,013       6,178,239
                                                -----------    -----------   -----------     -----------
                                                -----------    -----------   -----------     -----------
</TABLE>

<TABLE>
<CAPTION>

1998                                            1ST QUARTER     2ND QUARTER  3RD QUARTER     4TH QUARTER
----                                            -----------     -----------  -----------     -----------
<S>                                             <C>             <C>          <C>             <C>
Net sales    . . . . . . . . . . . . . . .          $55,164        $67,109       $75,489        $116,000
                                                                                               
Cost of sales  . . . . . .  . . . . . . . .          42,653         53,085        58,612          92,320
                                                -----------    -----------   -----------     -----------
Gross profit .  . . . . . . . . . . . . . .          12,511         14,024        16,877          23,680
Selling, general and administrative
 expenses . . . . . . . . . . . . . . . . .          10,263         11,002        13,395          18,729
                                                -----------    -----------   -----------     -----------
Operating income   . . . .  . . . . . . . .           2,248          3,022         3,482           4,951
Interest expense  . . . . . . . . . . . . .            (426)          (818)         (348)         (1,019)
Other income  . . . . . . . .  . . .  . . .             124             42            39              22
                                                -----------    -----------   -----------     -----------
Income before income taxes  . . . . . . . .           1,946          2,246         3,173           3,954
Provision for income taxes    . . . . . . .             860          1,012         1,388           1,734
                                                -----------    -----------   -----------     -----------

Net income  . . . . . . . . . . . . . . . .          $1,086         $1,234        $1,785          $2,220
                                                -----------    -----------   -----------     -----------
                                                -----------    -----------   -----------     -----------
Earnings per share of common stock (basic and
    diluted)* . . . . . . . . . . . . . . .           $0.14          $0.15         $0.17           $0.20
                                                -----------    -----------   -----------     -----------
                                                -----------    -----------   -----------     -----------
Weighted average number of common
   shares outstanding . . . . . . . . . . .       7,779,377      8,190,752    10,553,191      11,151,490
                                                -----------    -----------   -----------     -----------
                                                -----------    -----------   -----------     -----------
Weighted average number of common
   shares outstanding-diluted   . . . . . .       7,941,116      8,336,968    10,788,005      11,356,915
                                                -----------    -----------   -----------     -----------
                                                -----------    -----------   -----------     -----------

</TABLE>

*  Aggregated quarterly earning per share amounts may not equal earnings per
share amounts for the year due to the method of performing calculations.


                                      34

<PAGE>

ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE.

          None


                                      35

<PAGE>
                               PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     Information concerning the directors of the Company is incorporated by
reference to "Election of Directors" in  Proxy Statement, for the 1999 Annual
Meeting of Stockholders of the Company ("1999 Proxy Statement").

ITEM 11.  EXECUTIVE COMPENSATION

     Information required by this item is incorporated by reference to 
"Compensation of Directors" and "Executive Compensation" in the 1999 Proxy
Statement.

ITEM 12.  BENEFICIAL OWNERSHIP OF COMMON STOCK BY CERTAIN BENEFICIAL OWNERS AND 
          MANAGEMENT 

     Information required by this item is incorporated by reference to
"Beneficial Ownership of Common Stock by Beneficial Owners and Management" in
the 1999 Proxy Statement.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Information required by this item is incorporated by reference to "Certain
Relationships and Related Transactions" in the 1999 Proxy Statement. 

                                 PART IV
                                     

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)       (1) AND (2)  FINANCIAL STATEMENTS
          Financial Statements
          See index to consolidated financial statements on page 18 of this
             Form 10-K.
     
     Financial Statement Schedules
     All financial statement schedules are omitted because they are not 
     applicable or not required, or because the required financial information
     is included in the consolidated financial statements or notes thereto.

     (3) EXHIBITS   
          
     See Index to Exhibits on page 37 of this Form 10-K.
     
(b)  REPORTS ON FORM 8-K FILED IN THE FOURTH QUARTER OF 1998

     Acquisition and Disposition of Assets of Axidata, 
     Inc. on Form 8-K filed December 16, 1998

     Acquisition and Disposition of Assets of Dreher 
     Business Products, Inc. on Form 8-K filed December 30, 1998.
     
     Amendment to Form 8-K(a) filed December 31, 1998.

(c)  EXHIBITS

     See Index to Exhibits on page 37 of this Form 10-K.


                                  36

<PAGE>

<TABLE>
<CAPTION>

Exhibit   
 No.     Index to Exhibits Description
------   -----------------------------
<S>       <C>
3.1       Amended and Restated Articles of Incorporation of Miami Computer
          Supply Corporation.*
3.2       Amended and Restated Code of Regulations of Miami Computer Supply
          Corporation.*
4.0       Form of Stock Certificate of Miami Computer Supply Corporation.*
10.1      Lease by and between Draft Partnership and Miami Computer Supply, Inc.
          dated October 26, 1995.*
10.2      Lease by and between John Schwarz, Sr., Marcella Schwarz, John
          Schwarz, Jr., and Robert T. Schwarz and Miami Computer Supply, Inc.,
          dated June 30, 1994.*
10.3      Miami Computer Supply, Inc. Profit Sharing Plan.*
10.4      Miami Computer Supply, Inc. Section 125C Cafeteria Plan.*
10.5      Credit Agreement between Miami Computer Supply, Inc. and National City
          Bank, as Administrative Agent, and the  Named Lending Institutions,
          dated January 8, 1998.**
10.6      Epson Authorized Reseller Agreement dated June 28, 1995.*
10.7      Proxima Reseller Agreement dated May 29, 1996.*
10.8      Hewlett Packard U.S. Reseller Channel Agreement as amended January 1,
          1996.*
10.9      Lexmark Dealer Agreement dated November 1986.*
10.10     3M Authorized Distributor Agreement dated January 27, 1987.*
10.11     Employment Agreement by and between Miami Computer Supply, Inc., and
          Thomas C. Winstel dated May 30, 1996.*
10.12     Employment Agreement by and between Miami Computer Supply, Inc. and
          Richard A. Newkold dated May 30, 1996.*
10.13     Employment Agreement by and between Miami Computer Supply, Inc. and
          Roger E. Turvy dated May 30, 1996.*
10.14     Employment Agreement by and between Miami Computer Supply, Inc. and
          Michael E. Peppel  dated May 30, 1996.*
10.15     Employment Agreement by and between Miami Computer Supply, Inc. and
          John C. Huffman III dated May 30, 1996.*
10.16     Split Dollar Agreement by and between Miami Computer Supply, Inc. and
          Thomas C. Winstel dated December 1, 1995.*
10.17     Split Dollar Agreement by and between Miami Computer Supply, Inc. and
          Richard A. Newkold dated December 1, 1995.*
10.18     Split Dollar Agreement by and between Miami Computer Supply, Inc. and
          Roger E. Turvy dated December 1, 1995.*
10.19     Miami Computer Supply Corporation 1996 Stock Option Plan.*
10.20     Miami Computer Supply Corporation Non-employee Director Stock Option
          Plan.*
10.21     Severance Agreement for Albert L. Schwarz dated December 23, 1997.
          Incorporated by reference from the Company's Form 8-K as filed with
          the Commission on January 2, 1998, SEC File No. 000-21561.
10.22     Agreement and Plan of Reorganization, dated as of November 26, 1997,
          by and between the Company, MCSC Texas Acquisition Corporation (a
          wholly owned subsidiary of the Company), BRITCO and the named
          stockholder of BRITCO. (Incorporated by reference from the Company's
          Current Report on Form 8-K filed on December 15, 1997).
10.23     Agreement and Plan of Reorganization, dated as of December 23, 1997,
          by and among the Company, MCSC Freemont Acquisition Corporation (a
          wholly owned subsidiary of the Company), TBS Printware Corporation and
          the named stockholders of TBS Printware Corporation.  (Incorporated by
          reference from the Company's Current Report on Form 8-K filed on
          January 15, 1998).
10.24     Addendum and Amendment to the Agreement and Plan of Reorganization,
          dated as of December 23, 1997, by and among the Company, MCSC Freemont
          Acquisition Corporation (a wholly owned subsidiary of the Company),
          TBS Printware Corporation and the named stockholders of TBS Printware
          Corporation.  (Incorporated by reference from the Company's Current
          Report on Form 8-K filed on January 15, 1998).
10.25     Agreement and Plan of Reorganization, dated as of November 21, 1997,
          by and among the Company, Minnesota Western/Creative Office Products,
          Inc., MCSC California Acquisition Corporation (a wholly owned
          subsidiary of the Company), and the named stockholders of Minnesota
          Western/Creative Office Products, Inc.  (Incorporated by reference
          from the Company's Current Report on Form 8-K filed on January 30,
          1998).
10.26     Addendum and Amendment to the Agreement and Plan of Reorganization,
          dated as of January 16, 1998, by and among the Company, Minnesota
          Western/Creative Office Products, Inc., MCSC California Acquisition
          Corporation (a wholly owned subsidiary of the Company), and the named
          stockholders of Minnesota Western/Creative Office Products, Inc. 
          (Incorporated by reference from the Company's Current Report on Form
          8-K filed on January 30, 1998).
</TABLE>


                                37


<PAGE>

<TABLE>
<CAPTION>


<S>       <C>
10.27     Agreement and Plan of Reorganization by and among the Company, MCSC
          Tennessee Acquisition Corporation, Consolidated Media Systems, Inc.
          and the Named Stockholders dated July 16, 1998.  (Incorporated by
          reference from the Company's Current Report on Form 8-K filed on
          September 23, 1998).
10.28     Asset Purchase Agreement, dated as of November 17, 1998, by and among
          the Company, 3553906 Canada Inc. (a wholly-owned subsidiary of the
          Company), Abitibi-Consolidated Inc. and Axidata Inc. (a wholly-owned
          subsidiary of Abitibi-Consolidated Inc.).  (Incorporated by reference
          from the Company's Current Report on Form 8-K filed on December 16,
          1998).
10.29     Stock Purchase and Sale Agreement and Plan of Reorganization by and
          among the Company, MCSC Buckeye Acquisition Corporation, Dreher
          Business Products Corporation, Matrix Data Corporation and the Named
          Stockholders dated November 19, 1998.  (Incorporated by reference from
          the Company's Current Report on Form 8-K filed on December 31, 1998).
21.0      Subsidiaries of the Registrant.
23.1      Consent of Elias, Matz, Tiernan & Herrick L.L.P.**
23.2      Consent of PricewaterhouseCoopers LLP.
27.0      Financial Data Schedule.
99.0      Forward-Looking Information.
</TABLE>
_________
*  Incorporated by reference from the Company's Registration Statement on Form
S-1 as filed with the Commission on November 11, 1996, SEC File No. 333-12689.

**  Incorporated by reference from the Company's Registration Statement on Form
S-3 as filed with the Commission on March 5, 1998, SEC File No. 333-36299.

                                          
                                          
                                          
                                          
                                          





                                   38



<PAGE>

                               SIGNATURES
                                          
          Pursuant to the requirements of Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                   Miami Computer Supply Corporation


                                   By /s/ Michael E. Peppel
                                      -------------------------------
                                          MICHAEL E. PEPPEL
                                          President and Chief 
                                           Executive  Officer
                                          
Date:  March  31, 1999

          Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated
                                          
<TABLE>
<CAPTION>

     Signature and Title                          Date
     -------------------                          ----
<S>                                               <C>
/s/Anthony W. Liberati                            March 31, 1999
-------------------------------
ANTHONY W. LIBERATI, Chairman 
of the Board and Director


/s/ Michael E. Peppel                             March 31, 1999
-------------------------------
MICHAEL E. PEPPEL,  President and 
Chief Executive Officer and Director


/s/Robert G. Hecht                                March 31, 1999
-------------------------------
ROBERT G. HECHT, Vice Chairman 
of the Board and Director     


/s/ Harry F. Radcliffe                            March 31, 1999
-------------------------------
HARRY F. RADCLIFFE, Treasurer and Director


/s/  Thomas C. Winstel                            March 31, 1999
-------------------------------
THOMAS C. WINSTEL, Director, Secretary and 
Vice President - Presentation Products


By /s/ Michael E. Peppel                          March 31, 1999
-------------------------------
MICHAEL E. PEPPEL, President and Chief 
Executive Officer
(Principal Executive Officer)



By  /s/ Ira H. Stanley                             March 31, 1999
    ----------------------------
    IRA H. STANLEY          
    Vice President - Chief Financial Officer
    (Principal Accounting Officer)
</TABLE>







                                    39