Franklin Company obtained a $160,000 line of credit from State Bank on January 1, Year 1. The company agreed to accept a variable interest rate that was set at 2% above the bank's prime lending rate. The bank's prime rate of interest and the amounts borrowed or repaid during the first three months of Year 1 are shown in the following table. Assume that Franklin borrows or repays on the first day of each month.

	Amount Borrowed (Repaid)	Prime Rate for the Month
1-January	$ 40,000	4.0%
1-February	(10,000)	4.5%
1-March	40,000	5.0%

What is the amount of interest expense recognized in March?

Multiple Choice

$262

$232

$408

$292