EXHIBIT 12

 

CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
 

 

 

Nine months ended

 

 

 

September 30,

 

October 1,

 

 

 

2007

 

2006

 

 

Millions

Earnings

Earnings before income taxes and minority interests

$

859

$

800

Add:

   Fixed charges

77

102

   Amortization of capitalized interest

4

4

   Distributed income of equity investees

71

46

Less:

   Equity in earnings of investees

137

89

   Capitalized interest

4

2

Earnings before fixed charges

$

870

$

861

           

Fixed charges

Interest expense

$

44

$

76

Capitalized interest

4

2

Amortization of debt discount

1

-

Interest portion of rental expense (1)

28

24

Total fixed charges

$

77

$

102

           

Ratio of earnings to fixed charges

11.3

8.4


(1) Amounts represent those portions of rent expense that are reasonable approximations of interest costs.