EXHIBIT 12
CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
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Nine months ended |
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October 1, |
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September 25, |
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2006 |
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2005 |
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Millions |
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Earnings |
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Earnings before income taxes and minority interests |
$ |
800 |
$ |
555 |
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Add: |
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Fixed charges |
102 |
109 |
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Amortization of capitalized interest |
4 |
3 |
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Distributed income of equity investees |
46 |
67 |
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Less: |
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Equity in earnings of investees |
(89 |
) |
(85 |
) |
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Capitalized interest |
(2 |
) |
(2 |
) |
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Earnings before fixed charges |
$ |
861 |
$ |
647 |
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Fixed charges |
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Interest expense |
$ |
76 |
$ |
83 |
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Capitalized interest |
2 |
2 |
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Amortization of premiums, discounts and capitalized expenses related to indebtedness |
- |
1 |
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Interest portion of rental expense(1) |
24 |
23 |
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Total fixed charges |
$ |
102 |
$ |
109 |
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Ratio of earnings to fixed charges |
8.4 |
5.9 |
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(1) Amounts represent those portions of rent expense that are reasonable approximations of interest costs. |