12. Change in Accounting Principle — Historically, the Company included warehousing, handling and outbound freight costs in operating expenses on its Consolidated Statements of Operations. Effective January 1, 2023, the Company elected to include these costs in cost of sales instead of operating expenses on its condensed consolidated statements of operations. The effects of the change in accounting have been retrospectively applied to all periods presented. The Company believes that the change in accounting is preferable as it aligns the Company’s classification of this warehousing, handling and outbound freight costs in such a way as to present operational management with a clearer vision of the operational performance by business unit. This accounting change also increases the comparability of the Company’s financial performance with its peer companies as most peer companies include warehousing, handling and outbound freight costs in cost of sales rather than operating expenses. As a result, this change is intended to help interested parties better understand the Company’s performance and facilitate comparisons with most of the Company’s peer companies. The following table compares the Company’s historical classification with the classification after the adoption of the change in accounting for the three months ended March 31, 2023 and 2022:


	Classification after adoption of accounting change						Historical classification
	For the three months ended March 31						For the three months ended March 31
	2023			2022			2023			2022
Net sales	$	124,885		$	149,593		$	124,885			149,593
Cost of sales		(86,348	)		(98,198	)		(77,093	)		(88,242	)
Gross profit		38,537			51,395			47,792			61,351
Operating expenses		(35,272	)		(36,646	)		(44,527	)		(46,602	)
Operating income	$	3,265		$	14,749		$	3,265		$	14,749

The change in accounting principle did not have any impact on operating income, net income and earnings per share.