Exhibit 12(b)

Xerox Corporation

The ratio of earnings to fixed charges, the ratio of earnings to combined fixed
charges and preferred stock dividends, as well as any deficiency of earnings are determined using the following applicable factors:

Earnings available for fixed chargesare calculated first, by determining the sum of: (a) income from continuing operations before income taxes, (b) distributed equity income, (c) fixed charges, as defined below and
(d) amortization of capitalized interest, if any. From this total, we subtract capitalized interest, if any.

Fixed chargesare
calculated as the sum of (a) interest costs (both expensed and capitalized), (b) amortization of debt expense and discount or premium relating to any indebtedness and (c) that portion of rental expense that is representative of the
interest factor.

Preferred stock dividendsused in the ratio of earnings to combined fixed charges and preferred stock dividends
consist of the amount of pre-tax earnings required to cover dividends paid on our Series C mandatory convertible preferred stock.

Computation of Ratio of Earnings to Fixed Charges



|                                                             |  |                             |      |   |      |   |      |  
|------------------------------------------------------------ |  | --------------------------- | ---- | - | ---- | - | ---- | -
|(in millions)                                                |  | Three MonthsEnded March 31, |     
|                                                             |  | 2006                        |      |   | 2005 |  
|Fixed charges:                                               |  |                             |      |   |      |   |      |  
|Interest expense                                             |  | $                           | 130  |   |      | $ | 147  |  
|Portion of rental expense which represents interest factor   |  |                             | 22   |   |      |   | 19   |  
|                                                             |  |                             |      |   |      |   |      |  
|Total Fixed charges                                          |  | $                           | 152  |   |      | $ | 166  |  
|                                                             |  |                             |      |   |      |   |      |  
|Earnings available for fixed charges:                        |  |                             |      |   |      |   |      |  
|Earnings                                                     |  | $                           | 247  |   |      | $ | 326  |  
|Less: Undistributed equity in income of affiliated companies |  |                             | (37  | ) |      |   | (35  | )
|Add: Fixed charges                                           |  |                             | 152  |   |      |   | 166  |  
|                                                             |  |                             |      |   |      |   |      |  
|Total Earnings available for fixed charges                   |  | $                           | 362  |   |      | $ | 457  |  
|                                                             |  |                             |      |   |      |   |      |  
|Ratio of earnings to fixed charges                           |  |                             | 2.38 |   |      |   | 2.75 |  
|                                                             |  |                             |      |   |      |   |      |  

Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends



|                                                                          |  |                              |      |   |      |   |      |  
|------------------------------------------------------------------------- |  | ---------------------------- | ---- | - | ---- | - | ---- | -
|(in millions)                                                             |  | Three Months Ended March 31, |     
|                                                                          |  | 2006                         |      |   | 2005 |  
|Fixed charges:                                                            |  |                              |      |   |      |   |      |  
|Interest expense                                                          |  |                              | 130  |   |      | $ | 147  |  
|Portion of rental expense which represents interest factor                |  |                              | 22   |   |      |   | 19   |  
|                                                                          |  |                              |      |   |      |   |      |  
|Total Fixed charges                                                       |  |                              | 152  |   |      |   | 166  |  
|Preferred stock dividends pre-tax income requirement                      |  |                              | 24   |   |      |   | 23   |  
|                                                                          |  |                              |      |   |      |   |      |  
|Total Combined fixed charges and preferred stock dividends                |  | $                            | 176  |   |      | $ | 189  |  
|                                                                          |  |                              |      |   |      |   |      |  
|Earnings available for fixed charges:                                     |  |                              |      |   |      |   |      |  
|Earnings                                                                  |  | $                            | 247  |   |      | $ | 326  |  
|Less: Undistributed equity in income of affiliated companies              |  |                              | (37  | ) |      |   | (35  | )
|Add: Fixed charges before preferred stock dividends                       |  |                              | 152  |   |      |   | 166  |  
|                                                                          |  |                              |      |   |      |   |      |  
|Total Earnings available for fixed charges and preferred stock dividends  |  | $                            | 362  |   |      | $ | 457  |  
|                                                                          |  |                              |      |   |      |   |      |  
|Ratio of earnings to combined fixed charges and preferred stock dividends |  |                              | 2.06 |   |      |   | 2.42 |  
|                                                                          |  |                              |      |   |      |   |      |  



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