A Treasury Bill with a Par Value of $100,000 Due

question 7

Multiple Choice

A Treasury bill with a par value of $100,000 due one month from now is selling today for $99,010.The effective annual yield is

• A)12.40%.
• B)12.55%.
• C)12.62%.
• D)12.68%.
• E)None of the options

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Definitions:

Subsidiary Ledger

A subsidiary ledger is a group of detailed accounts where their totals tie into and support summary amounts in one or more accounts in the general ledger.

General Ledger

A comprehensive collection of a company's accounts and transactions, serving as the foundation of the accounting system.

Controlling Account

The account in the general ledger that summarizes the balances of the accounts in a subsidiary ledger.

Purchases Journal

The purchases journal is a financial record keeping system where a business logs all purchases of inventory on credit, excluding cash purchases.