Your client, Software and Stuff (Software), has developed a new electronic game. One part of the game uses software developed by another company, Component of Yuma (Component). Software signed an agreement with Component that provides that Software will pay Component a royalty of $1.00 per game sold. At year-end you note that a material liability is payable by Software to Component under the terms of the royalty agreement. Provide a list of procedures that should be performed on the royalty liability and the related royalty expense for the year.
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