It’s actually a lot easier than you’d think. No need for any outside applications. The only downside is that you’ll need to do this from your computer, instead of just being able to do it from the phone itself.
Step 1: Connect your phone to your computer. Make sure you select “Connect as Media device (MTP).
Mac Users – You will need to download Android File Transfer for this. It is free and very simple to use. This just enables you to get into the Nexus 4 folders via your computer.
Windows Users – Nothing extra is needed.
Step 2: Open Android File Transfer (For Windows Users it’s just the Nexus 4 Folder) and find the “Ringtone” folder.
Step 3: Drag the song or sound file you want to use into this folder.
Step 4: Disconnect from Computer
Step 5: On Nexus 4, go into Settings, Sound, and Phone Ringtone. The file you put in the folder is now on the list.
If you want to start your ringtone in the center of the song or the chorus you’ll need to edit the sound file before you put it in the Ringtone folder. I just do this in Garage Band.