Changing the Skeleton theme slightly

OK. So I got most changes done except the last one

In the template.php file it says the following:

    // the site name -- can be replaced, through CSS, by an image -- access key 1
    if($context['site_name'] && is_callable(array('i18n', 's')))
        echo '<p id="header_title"><a href="'.$context['url_to_root'].'" title="'.encode_field(i18n::s('Front page')).'" accesskey="1">'.$context['site_name'].'</a></p>'."\n";
 

Any idea what I need to do to get a logo called "logo.png" or "logo.jpg" to be displayed instead of the "site_name".

I've looked at the CSS file but find no obvious clues.