Consider the following simplified financial statements for the Phillips Corporation (assuming no income taxes): Phillips has predicted a sales increase of 11 percent. It has predicted that every item on the balance sheet will increase by 11 percent as well. Calculate the dividend paid. (Do not round your intermediate calculations.) HINT: Here you start by calculating the growth in assets (change in left hand side of balance sheet). We know that every category (debt and equity) on the right hand side of the Balance Sheet grows at the same rate as assets. So next we need to calculate the change in total equity because that change in equity is related to the new (pro forma) retained earnings. So next calculate the pro forma net income, and figure out how much can be paid in dividends (so that you have exactly the projected growth in equity left as your projected retained earnings). If the dividend is negative, then the firm will need to issue new shares of stock (can't finance growth in equity internally through retained earnings). $10,118 $10,092 $10,086 $10,099 $18,812