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Dow Chemical Co. (DOW) | Analysis of Debt

Total Debt Disclosure

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Dow Chemical Co., Statement of Financial Position, Debt

USD $ in millions

		Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007
	Notes payable
	Long-term debt due within one year
	Long-term debt, excluding debt due within one year
	Total debt

Item	Description	The company
Total debt	Sum of the carrying values as of the balance sheet date of all debt plus capital lease obligations.	Dow Chemical Co.'s total debt increased from 2009 to 2010 but then declined significantly from 2010 to 2011.

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Dow Chemical Co.

USD $ in millions

	12 months ended	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007
	Interest expense and amortization of debt discount
	Capitalized interest
	Interest costs incurred

Source: Based on data from Dow Chemical Co., Annual Reports

Item	Description	The company
Interest expense and amortization of debt discount	Represents the portion of interest incurred in the period on debt arrangements that was charged against earnings.	Dow Chemical Co.'s interest expense and amortization of debt discount declined from 2009 to 2010 and from 2010 to 2011.
Capitalized interest	The amount of interest that was capitalized during the period.	Dow Chemical Co.'s capitalized interest increased from 2009 to 2010 and from 2010 to 2011.
Interest costs incurred	Total interest costs incurred during the period and either capitalized or charged against earnings.	Dow Chemical Co.'s interest costs incurred declined from 2009 to 2010 and from 2010 to 2011.

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		Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007
	Selected Financial Data (USD $ in millions)
	Net income attributable to The Dow Chemical Company
	Add: Net income attributable to noncontrolling interests
	Add: Interest expense and amortization of debt discount
	Add: Income tax expense (benefit)
	Earnings before interest and tax (EBIT)

	Interest costs incurred
	Ratio With and Without Capitalized Interest
	Interest coverage ratio (excluding capitalized interest)¹
	Adjusted interest coverage ratio (including capitalized interest)²

2011 Calculations

¹ Interest coverage ratio (excluding capitalized interest) = EBIT ÷ Interest expense and amortization of debt discount
= ÷ =

² Adjusted interest coverage ratio (including capitalized interest) = EBIT ÷ Interest costs incurred
= ÷ =

Ratio	Description	The company
Adjusted interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments (including capitalized interest).	Dow Chemical Co.'s adjusted interest coverage ratio improved from 2009 to 2010 and from 2010 to 2011.