Question 5. Gaines Co. creates components for mobile phones and has a fiscal year end of December 31. In November of the current year, one of its competitors introduced a new product that might render obsolete some of Gaines's inventory. The sales manager wants to recognize the loss on the inventory as Gaines Co. disposes of it. Since the competitor's product was introduced so late in the year, it is not likely that Gaines Co. would be able to fully dispose of the effected inventory in the current year, meaning that a portion of the inventory would be written down in this year's financial statements and the remainder in the following year. Is this acceptable under GAAP? Explain why or not to the sales manager. Quote the relevant language from the codification as well as including the relevant Codification references in XXX-YY-ZZ-** format).