AM section question # 39
Total interest costs incurred (3,540)
Less amount capitalized (30)
Interest Expense (3,510)
the answer states: “the capitalization of interest costs increased EBIT by $30mil”
I’m a little confused because IF we don’t capitalize interests, then they will be recorded as interest expense … Thus we’ll have 3,540 as interest expense … But EBIT is before interest anyway so it will not be affected regardless
Am I missing something?