EX-12 2 f26784exv12.htm EXHIBIT 12 exv12
 

EXHIBIT 12
McKESSON CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES PREVIOUSLY INCLUDED IN THE ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED MARCH 31, 2006
                                         
    Years Ended March 31,
(In millions)   2006     2005     2004     2003     2002  
 
 
                                       
Earnings:
                                       
Income (Loss) from continuing operations before income taxes
  $ 1,171     $ (266 )   $ 869     $ 812     $ 558  
 
                                       
Adjustments:
                                       
Equity in net income of and dividends from equity investees
    (15 )     (4 )     (1 )     (6 )     2  
Fixed charges
    133       159       158       165       161  
Interest Capitalized
    (4 )     (6 )     (4 )     (3 )     (2 )
 
                             
 
                                       
Earnings as adjusted
  $ 1,285     $ (117 )   $ 1,022     $ 968     $ 719  
 
                             
 
                                       
Fixed charges:
                                       
Interest expense (a)
  $ 94     $ 118     $ 120     $ 128     $ 126  
Portion of rental expense representative of the interest factor
    35       35       34       34       33  
Capitalized interest
    4       6       4       3       2  
 
                             
 
                                       
Total fixed charges
  $ 133     $ 159     $ 158     $ 165     $ 161  
 
                             
 
                                       
Ratio:
                                       
Ratio of earnings to fixed charges
    9.7       (b)       6.5       5.9       4.5  
 
                             
 
(a)   Interest expense includes amortization of debt discounts and deferred loan costs.
 
(b)   Earnings for the year ended March 31, 2005 were inadequate to cover fixed charges. The coverage deficiency was $276 million for ratio of earnings to fixed charges.