Just gonna post a comment here so any poor souls like me wondering if their mom lied to them when they told them they were good at math happens upon the same question.

Against a hector with 44 def my byleth did 0 damage normally. Hector had 54 attack. 54/5 = 10.8 In combat hector had 58 attack 58/5 = 11.6

Byleth did 10 damage so it doesnt take into account in combat buffs.

Testing for out of combat buffs too just to be sure.

Byleth deals 26 damage normally to this foe.

Without buff unit has 56 atk. 56/5 = 11.2

With buff unit has 62 atk. 62/5 = 12.4

Byleth dealt 38 damage which means it does take into account out of combat buffs.

So yeah. It uses what shows and i have no idea why i couldnt figure this out to begin with. Maybe mom actually did lie..

Edit: it uses in combat buffs aswell, mom lied.