QUESTION 2: GOAL CONGRUENCE AT A LARGE AUDIT FIRM (15 points) After graduating from Rutgers with a degree in accounting, you go to work for the Newark, NI office of a large regional accounting firm. After working in their audit division for 3 years, you switch to internal management within your firm and become part of the team that provides strategic direction to the other divisions of the accounting firm (audit, tax, and advisory divisions). Your job is to help the managing partner of the accounting firm in key decision-making about what new lines of business to pursue, evaluate the performance of each division and of individual teams within each division, evaluate the performance of audit seniors, associates, engagement managers, and junior partners and help decide whom to "fast-track and whom to not One of the key strategic decisions your team needs to assist with this year is whether or not to invest in a new software that will automate some administrative tasks performed by each division. There are two competing bids for the software, labeled "A and "B. Software A and B both require initial investment of $50,000. Both pieces of software will become obsolete and have to be replaced in 5 years Soft ware A will generate cash operating cost savings of $20,000 per year. Software B will generate cash operating cost savings of $14,000 in Year 1, $16,000 in Year 2, $20,000 in Year 3, $25,000 in Year 4, and $35,000 in Year 5 To purchase the new software, $20,000 will be ralsed in the form of a bank loan, at a 3% interest rate, and the remaining $30,000 will be raised in the form of equity, which carries an implied cost of 8%. (0) Which software should be purchased, A or B? Justify your recommendation with supporting calculations. (5 pts)