EX-12 6 dex12.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Computation of Ratio of Earnings to Fixed Charges

EXHIBIT 12

Computation of Ratio of Earnings to Fixed Charges

Verizon Communications Inc. and Subsidiaries

 

     (dollars in millions)  
Years Ended December 31,    2010     2009     2008     2007     2006  

Earnings:

           

Income before provision for income taxes,
discontinued operations, extraordinary item,
and cumulative effect of accounting change

    $ 12,684      $ 13,520      $ 1,643      $ 16,783      $ 15,956    

Equity in earnings of unconsolidated businesses

      (508 )      (553 )      (567 )      (585 )      (773)   

Dividends from unconsolidated businesses

      510        942        779        2,571        42    

Interest expense (1)

      2,523        3,102        1,819        1,829        2,349    

Portion of rent expense representing interest

      837        839        734        684        650    

Amortization of capitalized interest

      139        134        125        115        112    
        

Earnings, as adjusted

    $ 16,185      $ 17,984      $ 4,533      $ 21,397      $ 18,336    
        

Fixed Charges:

           

Interest expense (1)

    $ 2,523      $ 3,102      $ 1,819      $ 1,829      $ 2,349    

Portion of rent expense representing interest

      837        839        734        684        650    

Capitalized interest

      964        927        747        429        462    

Preferred stock dividend requirement (2)

      –        –        –        –        2    
        

Fixed Charges

    $ 4,324      $ 4,868      $ 3,300      $ 2,942      $ 3,463    
        

Ratio of earnings to fixed charges

      3.74        3.69        1.37        7.27        5.29    
        

 

(1)

We classify interest expense recognized on uncertain tax positions as income tax expense and therefore such interest expense is not included in the Ratio of Earnings to Fixed Charges.

 

(2)

On January 15, 2006, Verizon redeemed $0.1 billion Verizon International Holding Ltd. Series A variable term voting cumulative preferred stock and paid holders the last dividend on that stock.