"We accept nothing larger than a $20 bill"

[Sauron]

Question on the legality of setting limits on the largest denomination accepted by a store:

I was taking a drive with my kids yesterday. I stopped to buy gas and drinks. The bill was around $26. I handed the clerk a $100 bill. He said, "I'm sorry, we don't take anything larger than a $20. Do you have anything smaller?" Well, as it happened, I didn't have anything smaller. I had the hundred and a five. The guy said, "I'm sorry, but I can't accept this." I said, "This is legal tender in the U.S. Why can't you accept it?" He said it was company policy, then asked me if I had a credit card. I did, but I didn't want to put this purchase on there. Since I had my kids with me, though, and because I didn't want to make a scene with them around, I handed over the card. The clerk then said it was "common sense" to ask if a bill would be accepted. That made me mad, and I shot back "No, common sense would tell me that American money could be used to pay a bill in an American store."

Anyway, legally, could I have insisted that the clerk honor the $100 bill? Can a company insist that it won't accept a bill larger than a twenty? I understand not wanting to give out a lot of money in change, but sheesh. This wasn't a mom-n-pop operation; I could understand if that were the case. It was a franchise with at least 17 stores (that was the store number printed on my receipt).