REVENUE

On January 1, 2018, we adopted ASC Topic 606, “Revenue from Contracts with Customers” ("ASC Topic 606") using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under ASC Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under ASC Topic 605, "Revenue Recognition" ("ASC Topic 605").

We recorded an increase to opening retained earnings of $798 (net of tax of $277) as of January 1, 2018 due to the cumulative impact of adopting ASC Topic 606, with the impact primarily related to the recognition of bill and hold transactions that were deferred under ASC Topic 605. The impact to revenue as a result of applying ASC Topic 606 for the three and nine months ended September 30, 2018 was a decrease of $1,598 and $3,294, respectively.

In accordance with the new revenue standard requirement, the disclosure impact of adoption on our condensed consolidated statements of income for the three and nine months ended September 30, 2018 and the condensed consolidated balance sheet as of September 30, 2018 was as follows:

Condensed Consolidated Statements of Income



	Three Months Ended September 30, 2018
	As Reported		Balance without Adoption		Effect of Change
Net sales	$	1,870,251	$	1,871,849	$	(1,598	)
Cost of merchandise sold	1,516,849		1,518,311		(1,462		)



	Nine Months Ended September 30, 2018
	As Reported		Balance without Adoption		Effect of Change
Net sales	$	5,340,235	$	5,343,529	$	(3,294	)
Cost of merchandise sold	4,324,258		4,327,342		(3,084		)

Condensed Consolidated Balance Sheet



	September 30, 2018
	As Reported		Balance without Adoption		Effect of Change
Merchandise inventory	$	661,530	$	667,907	$	(6,377	)
Other current assets	26,692		26,969		(277		)
Other non-current liabilities	21,288		28,528		(7,240		)
Retained earnings	722,274		721,688		586

The following table summarizes the percentages of our net sales attributable to each of our vertical markets for the three and nine months ended September 30, 2018 and 2017:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Construction	60.4	%	58.8	%	59.4	%	58.6	%
Industrial & Utility	20.3		21.9		21.4		21.9
CIG	19.3		19.3		19.2		19.5
Total net sales	100.0	%	100.0	%	100.0	%	100.0	%

We had no material contract assets, contract liabilities, or deferred contract costs recorded on the condensed consolidated balance sheet as of September 30, 2018. In addition, for the three and nine months ended September 30, 2018, revenue recognized in the reporting period that was included in the contract liability balance at the beginning of the period is not material.

Revenue expected to be recognized in any future year related to remaining performance obligations is not material. As permitted in ASC Topic 606, we have elected to omit disclosure related to performance obligations for revenue pertaining to contracts that have an original expected duration of one year or less, to contracts where revenue is recognized as invoiced and to contracts with variable consideration related to wholly unsatisfied performance obligations.