Attached files
| file | filename |
|---|---|
| EX-32 - EXHIBIT 32 - CUMMINS INC | cmi2016final10-kexhibit32.htm |
| EX-31.B - EXHIBIT 31.B - CUMMINS INC | cmi2016final10-kexhibit31b.htm |
| EX-31.A - EXHIBIT 31.A - CUMMINS INC | cmi2016final10-kexhibit31a.htm |
| EX-24 - EXHIBIT 24 - CUMMINS INC | cmi2016final10-kexhibit24.htm |
| EX-23 - EXHIBIT 23 - CUMMINS INC | cmi2016final10-kexhibit23.htm |
| EX-21 - EXHIBIT 21 - CUMMINS INC | cmi2016final10-kexhibit21.htm |
| 10-K - 10-K - CUMMINS INC | cmi2016final10-kdocument.htm |
EXHIBIT 12
CUMMINS INC. AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
Years ended December 31, | ||||||||||||||||||||
In millions | 2016 | 2015 | 2014 | 2013 | 2012 | |||||||||||||||
Earnings | ||||||||||||||||||||
Income before income taxes (1) | $ | 1,930 | $ | 2,025 | $ | 2,434 | $ | 2,119 | $ | 2,271 | ||||||||||
Add | ||||||||||||||||||||
Fixed charges | 148 | 140 | 138 | 112 | 104 | |||||||||||||||
Amortization of capitalized interest | 2 | 2 | 1 | 1 | 2 | |||||||||||||||
Distributed income of equity investees | 212 | 248 | 228 | 271 | 329 | |||||||||||||||
Less | ||||||||||||||||||||
Equity in earnings of investees | 260 | 273 | 330 | 325 | 347 | |||||||||||||||
Capitalized interest | 6 | 3 | 7 | 7 | 7 | |||||||||||||||
Earnings before fixed charges | $ | 2,026 | $ | 2,139 | $ | 2,464 | $ | 2,171 | $ | 2,352 | ||||||||||
Fixed charges | ||||||||||||||||||||
Interest expense (2) | $ | 69 | $ | 65 | $ | 64 | $ | 41 | $ | 32 | ||||||||||
Capitalized interest | 6 | 3 | 7 | 7 | 7 | |||||||||||||||
Amortization of debt discount and deferred costs | 3 | 3 | 3 | 2 | 6 | |||||||||||||||
Interest portion of rental expense (3) | 70 | 69 | 64 | 62 | 59 | |||||||||||||||
Total fixed charges | $ | 148 | $ | 140 | $ | 138 | $ | 112 | $ | 104 | ||||||||||
Ratio of earnings to fixed charges (4) | 13.7 | 15.3 | 17.9 | 19.4 | 22.6 | |||||||||||||||
___________________________________________________
(1) For the year ended December 31, 2016, income before income taxes included a $138 million charge related to a loss contingency. For the year ended December 31, 2015, income before income taxes included a $211 million charge related to impairment of light-duty diesel assets, $90 million of restructuring actions and other charges and a $60 million charge related to a loss contingency. For the year ended December 31, 2012, consolidated net income included $52 million of restructuring and other charges, a $6 million gain related to adjustments from our 2011 divestitures and a $20 million charge related to legal matters.
(2) The interest amount in the table above does not include interest expense associated with uncertain tax positions. In 2015, we adopted new rules related to balance sheet debt issuance costs, which resulted in the reclassification of our December 31, 2014, debt balance, reducing our long-term debt by $12 million. In September 2013, we issued $1 billion of senior unsecured debt.
(3) Amounts represent those portions of rent expense that are reasonable approximations of interest costs.
(4) 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.