EX-12 2 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,         2006     2005     2004     2003     2002
                                   

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

        $    8,154     $   8,448     $    7,977     $   2,681     $   3,797

Minority interest

        4,038     3,001     2,329     1,562     1,303

Equity in (earnings) loss of unconsolidated businesses

        (773 )   (686 )   (1,690 )   (1,273 )   1,548

Dividends from unconsolidated businesses

        42     2,336     162     198     96

Interest expense

        2,349     2,129     2,336     2,741     3,072

Portion of rent expense representing interest

        530     511     449     432     391

Amortization of capitalized interest

        112     108     104     103     87
    

Income, as adjusted

        $  14,452     $  15,847     $  11,667     $   6,444     $  10,294
    

Fixed charges:

                                 

Interest expense

        $    2,349     $    2,129     $    2,336     $   2,741     $    3,072

Portion of rent expense representing interest

        530     511     449     432     391

Capitalized interest

        462     352     177     144     185

Preferred stock dividend requirement

        2     9     8     12     18
    

Fixed Charges

        $   3,343     $    3,001     $    2,970     $   3,329     $    3,666
    

Ratio of Earnings to Fixed Charges

        4.32     5.28     3.93     1.94     2.81