The Stuart Glass Company Established a Line of Credit with a Local

The Stuart Glass Company established a line of credit with a local bank.The maximum amount that can be borrowed under the terms of the agreement is $1,000,000 at an annual rate of 8 percent.A compensating balance averaging 25 percent of the amount borrowed is required.Prior to the agreement,Stuart had no deposit with the bank.Shortly after signing the agreement,Stuart needed $240,000 to pay off a note that was due.Stuart decides to borrow an amount sufficient to pay the $240,000 note and also to cover the compensating balance.How much must Stuart Glass borrow?

A) $300,000
B) $320,000
C) $375,000
D) $400,000