Using the Following Information, What Amount of "Shrinkage" Would Be

Multiple Choice

Using the following information, what amount of "shrinkage" would be identified under the periodic inventory system? $\begin{array}{|l|r}\text { Inventory at the beginning of the year } & \$ 300,000 \\\hline \text { Inventory based on count at the end of the year } & \$ 650,000 \\\hline \text { Inventory purchases during the year } & \$ 1,000,000\end{array}$

A) $ 0
B) $300,000
C) $650,000
D) $700,000