Deleting area of graphic

I need to delete a line through a letter in Illustrator CS3, in the past I've used Photoshop and just made my lines, selected them and changed to the letter (rasterized) layer and hit delete. This deleted the area of the lines through the letter.

Now I need to make the same thing in Illustrator CS3 but can't figure out how to do it. Here is a example of what the letter needs to look like: EXAMPLE LETTER