As Director of Taxation of Verblonget Ltd., a Canadian-controlled private corporation, you are responsible for ensuring that corporate income tax instalments are correctly calculated and paid on time. The corporation has a December 31 year-end and operates only in Canada. In 2018, the corporation paid $33,000 in income tax on $150,000 of active business income. In 2019, it paid $40,000 on $180,000 of active business income. At the beginning of 2020, you expected active business income to be a little lower than last year, at $175,000, and this would result in income tax of $38,000 for the year.

Required:

a) Determine the minimum amount that should be paid in instalments for 2020 to be sure of not having to pay any interest on a deficiency of instalments. Show all options with supporting calculations. Indicate the specific dates on which these instalments must be paid. What is the best method?

b)Assume that your estimate of the income tax for 2020 was inaccurate because the actual income tax amount turns out to be $45,000 for 2020. Also, assume that the corporation paid the minimum monthly (not quarterly) required instalments computed in (a) on time. Determine the balance due and on what specific date the amount must be paid?