EXHIBIT 12

 

CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

 

 

 

Three months ended

 

 

 

April 1,

 

April 2,

 

 

 

2007

 

2006

 

 

Millions

Earnings

Earnings before income taxes and minority interests

$

227

$

228

Add:

   Fixed charges

26

36

   Amortization of capitalized interest

1

1

   Distributed income of equity investees

18

17

Less:

   Equity in earnings of investees

33

26

   Capitalized interest

1

1

Earnings before fixed charges

$

238

$

255

           

Fixed charges

Interest expense

$

16

$

27

Capitalized interest

1

1

Interest portion of rental expense(1)

9

8

Total fixed charges

$

26

$

36

           

Ratio of earnings to fixed charges

9.2

7.1

 

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