EXHIBIT 12 FLAGSTAR COMPANIES, INC. COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (IN THOUSANDS EXCEPT RATIOS) PREDECESSOR SUCCESSOR JANUARY 1 JULY 21 TO YEAR ENDED TO JULY 20, DECEMBER 31, DECEMBER 31, 1989 1989 1990 1991 1992 1993 Pretax earnings (losses).................... $ 38,421 $(85,333) $(77,808) $(85,674) $(58,358) $(1,729,384) Add: Net interest expense after capitalized interest............................... 62,031 113,851 290,507 294,927 291,910 254,352 Amortization of debt expense.............. 499 3,692 23,807 13,910 11,998 11,815 Interest factor in rents.................. 8,635 6,539 16,424 16,371 17,124 18,900 Total earnings (losses).............. $ 109,586 $ 38,749 $252,930 $239,534 $262,674 $(1,444,317) Fixed charges: Gross interest expense before capitalized interest............................... $ 62,340 $114,232 $290,993 $295,157 $292,200 $ 254,630 Amortization of debt expense.............. 499 3,692 23,807 13,910 11,998 11,815 Interest factor in rents.................. 8,635 6,539 16,424 16,371 17,124 18,900 Total fixed charges.................. $ 71,474 $124,463 $331,224 $325,438 $321,322 $ 285,345 Ratio of earnings to fixed charges.......... 1.53 -- -- -- -- -- Deficiency in the coverage of fixed charges by earnings before fixed charges.......... $ 85,714 $ 78,294 $ 85,904 $ 58,648 $ 1,729,662 For purposes of these computations, the ratio of earnings to fixed charges has been calculated by dividing pretax earnings by fixed charges. Earnings, as used to compute the ratio, equals the sum of income before income taxes and fixed charges excluding capitalized interest. Fixed charges are the total interest expenses including capitalized interest, amortization of debt expenses and a rental factor that is representative of an interest factor (estimated to be one third) on operating leases.