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Help tools.jar seems to be not in Android Studio classpath on Windows 8

I installed Android Studio but it was giving me error that I need to install JDK but JDK was already installed. Then I realized it is asking to install 64bit version of JDK.

Anyway I just downloaded latest JDK 64bit version and set the following in Environment Variable but still Android Studio is giving error:

Error
'tools.jar' seems to be not in AndroidStudio classpath.Please ensure JAVA_HOME points to JDK rather than JRE.

Following paths are set in my Windows 8.

Path in UserVariables
E:\Program Files\Java\jdk1.8.0_25\bin

JAVA_HOME in SystemVariables
E:\Program Files\Java\jdk1.8.0_25

Path in SystemVariables
E:\Program Files\Java\jdk1.8.0_25\bin

32bit JDK is installed on C drive while 64bit JDK is installed on E drive (as shown above). 32 bit JDK is not being used in any User or System Variables.

I have also restarted the PC.

How do I fix this issue?
 
Do you have a %CLASSPATH% system variable set pointing to the 32-bit JDK? That's all I can think of, short of uninstalling the 32-bit version.
 
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