EX-12 8 y87773exv12.htm EX-12 exv12
Exhibit 12
MERCK & CO., INC. AND SUBSIDIARIES
Computation of Ratios of Earnings to Fixed Charges
($ in millions except ratio data)
                                         
    Years Ended December 31,  
    2010     2009     2008     2007     2006  
Income Before Taxes
  $ 1,653     $ 15,290     $ 9,931     $ 3,492     $ 6,342  
 
                                       
Add (Subtract):
                                       
One-third of rents
    144       79       75       66       68  
Interest expense, gross
    715       460       251       384       375  
Interest capitalized, net of amortization
    3       27       42       32       29  
Equity (income) loss from affiliates, net of distributions
    (263 )     (511 )     (494 )     (454 )     (363 )
 
                             
Earnings as defined
  $ 2,252     $ 15,345     $ 9,805     $ 3,520     $ 6,451  
 
                             
One-third of rents
  $ 144     $ 79     $ 75     $ 66     $ 68  
Interest expense, gross
    715       460       251       384       375  
Preferred stock dividends
    202       143       145       158       166  
 
                             
Fixed Charges
  $ 1,061     $ 682     $ 471     $ 608     $ 609  
 
                             
 
                                       
Ratio of Earnings to Fixed Charges
    2       23       21       6       11  
 
                             
For purposes of computing these ratios, “earnings” consist of income before taxes, one-third of rents (deemed by the Company to be representative of the interest factor inherent in rents), interest expense, interest capitalized, net of amortization and equity (income) loss from affiliates, net of distributions. “Fixed charges” consist of one-third of rents, interest expense as reported in the consolidated financial statements and dividends on preferred stock. Interest expense does not include interest related to uncertain tax positions.