EXHIBIT 12.1
H&R BLOCK
Computation of Ratio of Earnings to Fixed Charges
(Amounts in thousands)
Computation of Ratio of Earnings to Fixed Charges
(Amounts in thousands)
10/31/07 | 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
Pretax income (loss) from continuing operations before change in accounting principle | $ | (407,316 | ) | $ | 635,798 | $ | 510,482 | $ | 527,613 | $ | 459,570 | $ | 192,106 | |||||||||||
FIXED CHARGES: | ||||||||||||||||||||||||
Interest expense | 27,333 | 105,393 | 76,367 | 82,311 | 81,672 | 88,784 | ||||||||||||||||||
Interest paid on deposits | 28,039 | 27,475 | — | — | — | — | ||||||||||||||||||
Interest portion of net rent expense (a) | 46,874 | 106,063 | 100,606 | 81,386 | 72,607 | 65,528 | ||||||||||||||||||
Total fixed charges | 102,246 | 238,931 | 176,973 | 163,697 | 154,279 | 154,312 | ||||||||||||||||||
Earnings before income taxes and fixed charges | $ | (305,070 | ) | $ | 874,729 | $ | 687,455 | $ | 691,310 | $ | 613,849 | $ | 346,418 | |||||||||||
Ratio of earnings to fixed charges: | ||||||||||||||||||||||||
Including interest paid on deposits (a) | — | 3.7 | 3.9 | 4.2 | 4.0 | 2.2 | ||||||||||||||||||
Excluding interest paid on deposits (b) | — | 4.1 | 3.9 | 4.2 | 4.0 | 2.2 |
(a) | One-third of net rent expense is the portion deemed representative of the interest factor. |
Note: In computing the ratio of earnings to fixed charges: (a) earnings have been based on income from continuing operations before income taxes and fixed charges (exclusive of interest capitalized) and (b) fixed charges consist of interest expense, interest paid on deposits, and the estimated interest portion of rents.
(a) | Fixed charges exceeded earnings by approximately $407.3 million for the six months ended October 31, 2007. | |
(b) | Fixed charges exceeded earnings by approximately $379.3 million for the six months ended October 31, 2007. |