(a) Bank Muscat collect bills for encashment on behalf of its customers. It is a part of its secondary functions. During the year 2019 it received bills for collection amounting to OMR 2,000,000. The balance on bills for collection on 31/12/2018 amounted to OMR 200,000. It returned the dishonoured bills to its customers amounting to OMR 25,000.

Bills collected during the year amounted to OMR 850,000. Record these transactions in the journal and prepare the ledger for the same.

(b) Banks provide the vital resource for an economy to survive and run smoothly. There are various types of banks which cater to the growth of a country namely, housing bank, industrial bank, commercial bank, agricultural bank etc.

(i) Explain the meaning of commercial bank in your own words. How are the commercial banks useful to Omans economy?

(ii) Mr. Ahmed wants to start a business. All his financial transactions will be through bank. His father retired from his office due to old age. His mother is doing some home tuition for school students. Now Ahmed, his father and his mother all three wants to open a bank account. You recommend the type of account to be opened by these three different people and explain their special features.