Cummins (CMI) 10-Q 2014 Q3 Quarterly report

EXHIBIT 12

CUMMINS INC. AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

	Nine months ended
In millions	September 28, 2014		September 29, 2013
Earnings
Income before income taxes	$	1,822	$	1,572
Add
Fixed charges	102		79
Amortization of capitalized interest	1		1
Distributed income of equity investees	195		162
Less
Equity in earnings of investees	263		254
Capitalized interest	5		5
Earnings before fixed charges	$	1,852	$	1,555
Fixed charges
Interest expense(1)	$	47	$	22
Capitalized interest	5		5
Amortization of debt discount and deferred costs	2		8
Interest portion of rental expense(2)	48		44
Total fixed charges	$	102	$	79
Ratio of earnings to fixed charges(3)	18.2		19.7

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⁽¹⁾The interest amount in the table above does not include interest expense associated with uncertain tax positions.

⁽²⁾Amounts represent those portions of rent expense that are reasonable approximations of interest costs.

⁽³⁾We have not issued preferred stock. Therefore, the ratio of earnings to combined fixed charges and preferred stock dividends are the same as the ratios presented above.