EX-12 6 a17-12292_1ex12.htm EX-12

EXHIBIT 12

 

COMPUTATION OF RATIO OF INCOME FROM

CONTINUING OPERATIONS TO FIXED CHARGES

FOR DECEMBER 31,

(UNAUDITED)

 

(Dollars in millions)

 

2016

 

2015

 

2014

 

Income from continuing operations before income taxes (1)

 

$

719

 

$

783

 

$

775

 

 

 

 

 

 

 

 

 

Add: fixed charges, excluding capitalized interest

 

364

 

466

 

514

 

 

 

 

 

 

 

 

 

Income as adjusted before income taxes

 

$

1,083

 

$

1,249

 

$

1,289

 

 

 

 

 

 

 

 

 

Fixed charges:

 

 

 

 

 

 

 

Interest expense

 

$

364

 

$

466

 

$

514

 

Capitalized interest

 

—

 

—

 

—

 

Portion of rental expense representative of interest (2)

 

—

 

—

 

—

 

 

 

 

 

 

 

 

 

Total fixed charges

 

$

364

 

$

466

 

$

514

 

 

 

 

 

 

 

 

 

Ratio of income from continuing operations to fixed charges

 

2.98

 

2.68

 

2.51

 

 

(1) Income from continuing operations before income taxes excludes (a) amortization of capitalized interest, and (b) the company’s share in the income and losses of less-than-fifty percent-owned affiliates.

(2) The company is globally located and conducts business primarily from parent-leased and parent-owned facilities for which it is charged occupancy charges. These costs may not be indicative of the expenses that IBM Credit will incur in the future, or would have incurred if the company had obtained these services from a third party. The amounts charged to the company by IBM in the periods presented were not material.

 

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