Where is the income from investment in Associates this reported on the income statement? I’m seeing a question in the CFAI text, reading 26, question 8 that states EBIT/interest expense ratio is not affected by investments in associates. Also, on question 6 in the same reading, they deduct the gain on investment in associates from Net Income but don’t account for taxes in the answer.
EBIT is operating income. Investment income from associates is not operating income. And btw- the questions clearly states “Excluding investment in associates”. Not reading question properly got to me during the last exam - don’t make those mistakes.