I am a CFA candidate and I am going to sit for the exam this December. I am currently working on Reading 53. Introduction to Fixed Income Valuation and I got stuck on an example in Schewer Note. Please help me!

Example P56 - Book 5 - Schewer Note:

“A $1000 90-day T-bill is priced with an annualized discount of 1.2%. Calculate its market price and its annualized add-on yield on a 365-day year”

Answer:

The discount from face value if 1.2% x 90 / 360 x 1,000 = $3 so the current price is 1000 - 3 = 997"

I dont understand the 1.2% x 90 / 360 x 1,000 = $3