If the collateral is inventory,the perfected purchase money security interest prevails if the purchase money secured party gives written notice of the perfection to the perfected nonpurchase money secured party.

Question

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Under the relevant provisions of the Uniform Commercial Code (UCC), a purchase money security interest in inventory prevails over a conflicting security interest in the same collateral granted by the debtor to another secured party, as long as the purchase money secured party perfects their security interest by taking possession or by filing a financing statement and gives written notice of the purchase money security interest to the holder of the conflicting security interest before the debtor takes possession of the inventory. This is stated in UCC Section 9-324(a). Therefore, the answer is true.

If the Collateral Is Inventory,the Perfected Purchase Money Security Interest