During the current year, your audit client, Video Corporation, was licensed to manufacture a patented type of television tube. The licensing agreement called for royalty payments of 50 cents for each tube manufactured by Video Corporation. What procedures would you follow in connection with your regular annual audit at December 31 to obtain evidence that the liability for royalties is correctly stated?

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Wilcox Company Unrecorded Accounts Payable M-1-1 April 30, 20x2 Invoice Date Vendor and Description Hill & Harper-unpaid Legal fees at Apr. 30, X2 (see Lawyer's letter at M-4) Amount 1000 Apr.1,x2 Drew Insurance Agency-unpaid premium on fire insurance for period Apr. 1, X2- Mar. 31, X5 (see insurance broker Letter at J-1-1) 1800 Apr 30,X2 Mays and Sage, Stockbrokers-advice for 100 shares of Madison Ltd. Common stock (settlement date May 7, X2) 2125-4