INGERSOLL-RAND COMPANY EXHIBIT 12 COMPUTATIONS OF RATIOS OF EARNINGS TO FIXED CHARGES Page 1 of 2 (Dollar Amounts in Millions) Years Ended December 31, Fixed charges: 1996 1995 1994 1993 1992 Interest expense........................... $122.4 $ 90.0 $ 46.9 $ 60.2 $ 64.7 Amortization of debt discount and expense.. 1.5 .8 .4 .7 .3 Rentals (one-third of rentals)............. 22.4 21.6 18.8 19.4 20.8 Capitalized interest....................... 4.6 3.6 3.2 3.1 3.5 Total fixed charges.......................... $150.9 $116.0 $ 69.3 $ 83.4 $ 89.3 Net earnings (loss).......................... $358.0 $270.3 $211.1 $142.5 $(234.4) Add: Minority income (loss) of majority- owned subsidiaries.................. 18.9 14.5 15.1 13.6 (33.2) Taxes on income....................... 210.3 158.9 118.8 90.0 67.4 Fixed charges......................... 150.9 116.0 69.3 83.4 89.3 Effect of accounting changes.......... -- -- -- 21.0 350.0 Less: Capitalized interest.................. 4.6 3.6 3.2 3.0 3.4 Undistributed earnings (losses) from less than 50% owned affiliates...... (23.1) 33.3 33.3 40.0 16.6 Earnings available for fixed charges ........ $756.6 $522.8 $377.8 $307.5 $ 219.1 Ratio of earnings to fixed charges .......... 5.01(1) 4.51 5.46 3.69(2) 2.45(3) Undistributed earnings (losses) from less than 50% owned affiliates: Equity in earnings (losses)................ $ 36.4 $ 36.6 $ 36.6 $ 42.1 $ 17.9 Less: Amounts distributed............... 59.5 3.3 3.3 2.1 1.3 Undistributed earnings (losses) from less-than 50% owned affiliates........... $(23.1) $ 33.3 $ 33.3 $ 40.0 $ 16.6 (1) The 1996 calculation includes the effect of a $42.4 million pretax charge mainly relating to the realignment of the company's foreign operations. The 1996 calculation also includes the $55 million of pretax income relating to the sales of the Process Systems Group. (2) The 1993 calculation includes the effect of the $5 million pretax charge relating to the restructure of the company's underground mining machinery business. Excluding this amount, the ratio would have been 3.75. INGERSOLL-RAND COMPANY EXHIBIT 12 COMPUTATIONS OF RATIOS OF EARNINGS TO FIXED CHARGES Page 2 of 2 (Dollar Amounts in Millions) (3) The company's portion of the earnings and fixed charges of the Dresser-Rand Company are included through September 30, 1992. Effective October 1, 1992, the company's ownership interest in the Dresser-Rand Company was reduced from 50% to 49%. The 1992 calculation includes (i) the effect of the $10 million pretax charge relating to the restructure of the company's aerospace bearings business and (ii) the full effect of the $70 million pretax restructure of operations charge relating to the Ingersoll-Dresser Pump Company. Excluding the 1992 restructure charges the ratio would have been 3.35.