Mr. Crowell, a self-employed seafood wholesaler, arranged a business meeting with his five principal clients during the current year. The night the clients arrived in town, Mr. and Mrs. Crowell entertained the clients and their spouses at their home. The cost of the food and beverages was $400. As each client left, they were given a cheese and fruit basket, which cost $40 each. The business meeting was held the next day at Mr. Crowell's office. Assuming no other similar expenses during the current year, what amount of the above expenses may Mr. Crowell deduct?

1 $0

2 $125

3 $300

4 $325