<TABLE>
<CAPTION>
                                      U.S. Securities and Exchange Commission
                                              Washington, D. C. 20549
                                               ---------------------

                                                    FORM 10-QSB

(Mark One)

<S>      <C>
[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

         For the quarterly period ended     September 30, 1998
                                        ...............................................................................

[  ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

         For the transition period from ....... to ....................................................................



              Commission File Number                          0-13324
                                    ...................................................................................



                                             QUESTRON TECHNOLOGY, INC.
 .......................................................................................................................
                                       (Exact name of small business issuer
                                           as specified in its charter)




         Delaware                                                                             23-2257354

 ......................................................................................................................
  (State or other jurisdiction                                                             (I. R. S. Employer
of incorporation or organization)                                                        Identification Number)


                               6400 Congress Avenue, Suite 200A, Boca Raton, FL 33487
                  ...............................................................................
                                     (Address of principal executive offices)



                                                  (561) 241-5251
                            ...........................................................
                                            (Issuer's telephone number)


     Check  whether  the issuer (1) filed all  reports  required  to be filed by
     Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for
     such shorter period that the registrant was required to file such reports),
     and (2) has  been  subject  to such  filing  requirements  for the  past 90
     days  Yes        X
              ...................
     No
           ....................


     As of November 6, 1998,  there were 4,736,935 shares of the issuer's Common
Stock outstanding.

     Transitional Small Business Disclosure Format (check one):

     Yes                            No              X
         ....................          ....................
</TABLE>

778321.3

<PAGE>




<TABLE>
<CAPTION>
                                             QUESTRON TECHNOLOGY, INC.


                                                       INDEX



                                                                                                      Page No.

<S>                                                                                                   <C>
PART I.         Financial Information.............................................................        3

     Item 1.    Financial Statements (Unaudited)..................................................        3

                         Consolidated Balance Sheet -
                         At September 30, 1998 and December 31,
                         1997.....................................................................        3

                         Consolidated Statement of Operations -
                         For the Three Month and Nine Month Periods Ended
                         September 30, 1998 and 1997..............................................        4

                         Consolidated Statement of Cash Flows -
                         For the Nine Month Periods Ended September 30, 1998
                         and 1997.................................................................        5

                         Notes to Consolidated Financial Statements...............................      6 - 11

     Item 2.    Management's Discussion and Analysis or Plan of Operation.........................     12 - 15

PART II.        Other Information.................................................................       16


SIGNATURES........................................................................................       17
</TABLE>



778321.3
                                        2

<PAGE>



<TABLE>
<CAPTION>
                                          PART I - FINANCIAL INFORMATION

Item 1.           Financial Statements.

                                     QUESTRON TECHNOLOGY, INC. & SUBSIDIARIES
                                            CONSOLIDATED BALANCE SHEET
                                     SEPTEMBER 30, 1998 AND DECEMBER 31, 1997

                                                      ASSETS

                                                                                September 30,        December 31,
                                                                                    1998                 1997
                                                                              -----------------    -----------------
                                                                                 (Unaudited)
<S>                                                                           <C>                   <C>             
Current assets:
   Cash and cash equivalents                                                  $          87,587     $        875,080
   Accounts receivable, less allowance for
      doubtful accounts of $138,646 and $93,561, respectively                        10,735,414            4,740,678
   Other receivables                                                                     61,866               77,733
   Inventories                                                                       17,284,914            8,415,777
   Other current assets                                                                 477,625              158,597
                                                                              -----------------    -----------------

Total current assets                                                                 28,647,406           14,267,865

Property and equipment - net                                                          1,452,292              910,988
Cost in excess of net assets of businesses acquired,
   less accumulated amortization of $978,743 and $549,566, respectively              32,910,866           16,549,726
Deferred income taxes                                                                 2,927,012            3,192,947
Other assets                                                                          2,420,611              273,321

      Total assets                                                                $  68,358,187        $  35,194,847
                                                                              =================    =================

                                        LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Accounts payable                                                             $     5,186,022       $    2,378,381
   Accrued expenses                                                                   1,753,597              839,514
   Income taxes payable                                                               1,209,317              201,477
   Current portion of long-term debt                                                  2,046,111            1,801,667
                                                                              -----------------    -----------------

Total current liabilities                                                            10,195,047            5,221,039
Deferred income taxes payable                                                           373,754              182,552
Long-term debt                                                                       30,566,428            9,893,521
                                                                              -----------------    -----------------
      Total liabilities                                                              41,135,229           15,297,112
                                                                              -----------------    -----------------

Commitments and contingencies
Common stock subject to put option agreement                                            362,343              622,857
Shareholders' equity:
   Preferred stock, $.01 par value; authorized 10,000,000
     shares; none issued in 1998 and 1,150,000 issued in 1997                                --               11,500
   Common stock, $.001 par value; authorized 20,000,000
     shares; issued 4,736,935 shares in 1998 and 2,122,439 in 1997                        4,732                2,122
   Additional paid-in capital                                                        39,830,354           33,462,524
   Accumulated deficit                                                             (12,618,993)         (13,845,790)
                                                                              -----------------    -----------------
                                                                                     27,216,093           19,630,356
   Less: Treasury stock, 11,849 shares,  at cost                                      (355,478)            (355,478)
                                                                              -----------------    -----------------
Total shareholders' equity                                                           26,860,615           19,274,878
                                                                              -----------------    -----------------

Total liabilities and shareholders' equity                                        $  68,358,187        $  35,194,847
                                                                              =================    =================
                                  See notes to Consolidated Financial Statements.
</TABLE>

778321.3
                                        3

<PAGE>



<TABLE>
<CAPTION>
                    QUESTRON TECHNOLOGY, INC. & SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
                   FOR THE THREE MONTH AND NINE MONTH PERIODS
                  ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)



                                                                Three Months Ended                 Nine Months Ended
                                                                  September 30,                      September 30,
                                                         --------------------------------   --------------------------------


                                                              1998             1997              1998              1997
                                                         --------------   --------------    --------------    --------------

<S>                                                        <C>             <C>                <C>               <C>         
Sales                                                      $ 17,799,542    $   6,645,650      $ 38,871,478      $ 15,738,987
                                                         --------------   --------------    --------------    --------------

Operating costs and expenses:
   Cost of products and services sold                        10,660,308        4,048,925        23,222,131         9,508,193
   Selling, general & administrative expenses                 4,053,074        1,692,182         9,116,655         4,212,025
   Depreciation and amortization                                322,296          127,325           655,455           308,752
                                                             15,035,678        5,868,432        32,994,241        14,028,970
                                                         --------------   --------------    --------------    --------------

Operating income                                              2,763,864          777,218         5,877,237         1,710,017

Interest expense                                              1,008,785           79,433         1,621,558           206,532
                                                         --------------   --------------    --------------    --------------

Income before income taxes                                    1,755,079          697,785         4,255,679         1,503,485
Provision for income taxes                                      719,582          288,185         1,744,828           620,939

Net income                                                $   1,035,497   $      409,600     $   2,510,851     $     882,546
                                                         ==============   ==============    ==============    ==============

Net income                                                $   1,035,497    $     409,600     $   2,510,851     $     882,546
Deduct: Preferred stock dividend                                 99,185           33,063           165,311            99,189
              Imputed non-cash preferred stock dividend         663,510          192,329         1,075,988           346,304
                                                         --------------   --------------    --------------    --------------

Net income used in per common share calculation           $     272,802    $     184,208     $   1,269,552     $     437,053
                                                         ==============   ==============    ==============    ==============



Net income per common share (*)                                 $   .06          $   .11           $   .31           $   .28
                                                         ==============   ==============    ==============    ==============
Net income per diluted common share (*)                         $   .06          $   .11           $   .31           $   .28
                                                         ==============   ==============    ==============    ==============


Average number of common shares outstanding                   4,738,766        1,646,636         4,099,800         1,578,436
                                                         ==============   ==============    ==============    ==============

Average number of diluted common shares outstanding           4,807,210        3,801,597         4,807,796         2,870,122
                                                         ==============   ==============    ==============    ==============

(*) Net income per common share and net income per diluted  common share for the
three and nine month periods ended  September  30, 1998 reflect  deductions  for
preferred stock dividends,  including  one-time,  non-cash dividends  associated
with  the  conversion  of  preferred  stock  into  common  stock.   Before  such
deductions, net income per common share was $.22 and $.61 for the three and nine
month periods ended September 30, 1998, respectively; and net income per diluted
common  share  was $.22 and $.52 for the  three  and nine  month  periods  ended
September 30, 1998, respectively.
                 See Notes to Consolidated Financial Statements.
</TABLE>

778321.3
                                        4

<PAGE>



<TABLE>
<CAPTION>
                                     QUESTRON TECHNOLOGY, INC. & SUBSIDIARIES
                                       CONSOLIDATED STATEMENT OF CASH FLOWS
                             NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)


                                                                      September 30,           September 30,
                                                                           1998                   1997
                                                                   ---------------------   ---------------------
<S>                                                                <C>                     <C>                 
Cash flows from operating activities:
  Net income                                                       $          2,510,851    $            882,546
  Adjustments to reconcile net income to net
    cash provided by operating activities:
      Depreciation and amortization                                             655,455                308,752
      Provision for doubtful accounts                                            39,085                 62,093
      Recognition of income tax benefit of net
        operating loss carryforward                                             265,935                435,064
  Change in assets and liabilities:
     Increase in accounts receivable                                         (3,316,642)              (838,531)
     Decrease in other receivables                                               15,867                114,205
     Increase in inventories                                                 (4,194,867)              (303,490)
     Increase (decrease) in accounts payable                                  1,217,985               (227,436)
     Increase in accrued expenses                                               522,967                561,271
     Increase in income taxes payable                                         1,007,840                 45,065
     Increase in deferred income taxes                                          191,202                 34,811
     (Increase) decrease in prepaid expenses and other assets                  (303,768)               194,065
                                                                   ---------------------   -------------------
     Net cash (used) provided by operating activities                        (1,388,090)             1,268,415
                                                                   ---------------------   -------------------

Cash flows from investing activities:
  Net cash consideration paid for acquired business                         (17,672,524)           (13,083,485)
  Acquisition of property and equipment                                        (568,769)               (78,759)
     Net cash used for investing activities                                 (18,241,203)           (13,162,244)
                                                                   ---------------------   --------------------

Cash flows from financing activities:
  Proceeds from borrowings under revolving facility                           5,647,799                     --
  Proceeds from convertible preferred stock unit offering                            --              6,900,000
  Proceeds from capital lease for computer system                               371,228                     --
  Proceeds from long-term debt financing                                     30,000,000             10,000,000
  Fees and expenses associated with long-term debt financing                 (1,976,300)                    --
  Notes issued for acquired businesses                                               --                625,000
  Costs associated with convertible preferred stock unit offering                    --             (1,260,447)
  Repayment of long-term debt                                                (9,583,334)            (1,375,000)
  Repayment of revolving facilities                                          (5,472,340)            (2,143,747)
  Payments on capital leases                                                    (63,943)                    --
  Payments on note issued for acquired business                                 (81,310)               (29,668)
                                                                   ---------------------   ---------------------
     Net cash provided by financing activities                               18,841,800             12,716,138
                                                                   ---------------------   ---------------------

(Decrease) increase in cash and cash equivalents                               (787,493)               822,309
Cash and cash equivalents at beginning of period                                875,080                258,548
                                                                   ---------------------   ---------------------
Cash and cash equivalents at end of period                         $             87,587    $         1,080,857
                                                                   =====================   =====================
                                  See Notes to Consolidated Financial Statements.
</TABLE>

778321.3
                                        5

<PAGE>


                   QUESTRON TECHNOLOGY, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)

Note 1.  Basis of presentation.

                  The accompanying  unaudited  consolidated financial statements
include  the  accounts of the Company  and its  subsidiaries.  The  consolidated
financial  statements have been prepared in accordance  with generally  accepted
accounting  principles for interim financial  information and in accordance with
the Securities and Exchange Commission's  instructions for a Quarterly Report on
Form  10-QSB.  Accordingly,  they  do not  include  all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements.

                  Management believes that all adjustments (consisting of normal
recurring  adjustments)  considered  necessary for a fair presentation have been
included.  Operating  results for the nine month period ended September 30, 1998
are not necessarily  indicative of the results that may be expected for the year
ending  December 31, 1998. The  consolidated  balance sheet at December 31, 1997
reflects the audited balance sheet at that date. For further information,  refer
to the  financial  statements  and footnotes  thereto  included in the Company's
annual report on Form 10-KSB for the year ended December 31, 1997.

Note 2.  Acquisition of Webb Distribution.

                  In March  1997,  the Company  acquired  100% of the issued and
outstanding capital stock of Comp Ware, Inc. d/b/a Webb Distribution ("Webb"), a
privately owned company.  The business of Webb is  substantially  similar to the
fastener,  electronic hardware,  and related products  value-added  distribution
business of the  Company,  serving  customers in the  high-technology  equipment
manufacturing industry. The purchase price for Webb consisted of:

                  (i)      $3,250,000 in cash;

                  (ii)     Note A in  the  amount  of  $375,000.  Principal  and
                           interest  at the rate of 10% are due and  payable  18
                           months from the effective date of the closing;

                  (iii)    Note B in  the  amount  of  $375,000.  Principal  and
                           interest at the rate of 10% are payable  monthly over
                           five years from the  effective  date of the  closing;
                           and

                  (iv)     1,500,000  Series IV Warrants  (the "Webb  Warrants")
                           issued to the majority  shareholder of Webb as a down
                           payment under the Stock Purchase Agreement.


                                        6
<PAGE>

                   QUESTRON TECHNOLOGY, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)


         Such  acquisition was effected  pursuant to a Stock Purchase  Agreement
dated as of December 16, 1996.  The Company has accounted  for such  acquisition
using the purchase method of accounting.  In connection  with this  acquisition,
the Company recorded  $3,723,277 of cost in excess of net assets of the business
acquired.

         In  connection  with  the  sale of the Webb  warrants  by the  majority
shareholder of Webb, Note A (as described in (ii) above) was satisfied  pursuant
to the terms of the acquisition  agreement,  effectively resulting in a $375,000
reduction in the cost of the acquisition.

Note 3.  Convertible Preferred Stock Unit Offering.

         In March 1997, the Company  completed an Offering of 1,150,000 Units of
its  securities.  Each  Unit  consisted  of one  share of  Series B  Convertible
Preferred  Stock and one  Series  IV  Common  Stock  Purchase  Warrant.  The net
proceeds  to the  Company,  after  deducting  underwriting  discounts  and other
expenses of the Offering,  were $5,639,553.  These proceeds were used in part to
finance the cash  portion of the  purchase  price of Webb.  The  remaining  cash
($2,389,553)  was  used  to  repay  the  outstanding  balance  on the  Company's
revolving  credit facility  ($750,000) and to repay the  outstanding  balance on
Webb's  revolving  credit  facility  ($1,000,000),  with the  remaining  balance
($639,553)  retained by the Company for working  capital.  On July 2, 1998,  the
1,150,000  shares  of  Series  B  Convertible  Preferred  Stock  converted  into
1,653,125 shares of common stock.

Note 4.  Acquisition of Integrated Material Systems, Inc.

         In June 1997, the Company  acquired 100% of the issued and  outstanding
capital stock of Integrated  Material Systems,  Inc. ("IMS"),  a privately owned
company.  The purchase price for IMS consisted of 50,000 shares of the Company's
common stock and an additional 75,000 shares of the Company's common stock to be
earned if IMS attains certain  earnings  targets.  In addition,  the acquisition
agreement calls for deferred purchase payments of up to $1,500,000 in cash based
on the future earnings of IMS,  payable in increments not to exceed $300,000 per
year over five years.

Note 5.  Acquisition of Power Components, Inc.

         In September  1997, the Company  purchased the net operating  assets of
Power Components,  Inc. ("PCI"), a privately owned  Philadelphia  distributor of
lithium  batteries  and  customized  battery  packs  and  assemblies,  through a
simultaneously  acquired  wholly-owned  subsidiary.  The purchase  price for PCI
consisted of:

                  (i)      $900,000 in cash;
                  (ii)      50,000 shares of the Company's common stock;
                 (iii)      a note payable in the amount of $250,000;
 


                                        7
<PAGE>

                   QUESTRON TECHNOLOGY, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)


                  (iv)     100,000  shares of the  Company's  common stock to be
                           earned if PCI attains certain earnings targets; and

                  (v)     deferred  purchase payments of up to $900,000 in cash
                          based  on the  future  earnings  of PCI,  payable  in
                          increments not to exceed $300,000 per year over three
                          years.

         Such transactions were effected pursuant to an Asset Purchase Agreement
and a Stock  Purchase  Agreement  dated  September  4,  1997.  The  Company  has
accounted for such  transactions  using the purchase  method of  accounting.  In
connection with these  transactions,  the Company recorded $1,237,028 of cost in
excess of net assets of the business acquired.

Note 6.           Acquisition of California Fasteners, Inc.

         In  September  1997,  the  Company  acquired  100%  of the  issued  and
outstanding capital stock of California Fasteners, Inc. ("Calfast"), a privately
owned company. The purchase price for Calfast consisted of:

                  (i)      $6,594,441 in cash;
                  (ii)     the assumption of $1,058,712 in debt net of cash on 
                           hand;
                  (iii)    475,106   shares  of  the  Company's   common  stock,
                           including  125,896  shares  of the  Company's  common
                           stock  which  sellers  of  Calfast  may  put  to  the
                           Company, valued at $2,981,288;
                  (iv)     up to $795,559 in cash to be paid if Calfast attained
                           certain  earnings  targets for the four month  period
                           ended  December 31, 1997, of which  $600,000 was paid
                           in March 1998; and
                  (v)      up to  $3,500,000  (50% in cash and 50% in  shares of
                           the  Company's   common  stock)  if  Calfast  attains
                           certain earnings targets for the year ending December
                           31, 1998.

         The  acquisition  of Calfast was effected  pursuant to a Stock Purchase
Agreement  dated as of August 29,  1997.  The  Company  has  accounted  for such
acquisition  using the purchase  method of accounting.  In connection  with this
acquisition,  the Company recorded $8,355,314 of cost in excess of net assets of
the business acquired.

Note 7.           Acquisition of Fas-Tronics, Inc.

         In September 1998, the Company completed the acquisition of 100% of the
issued and outstanding  capital stock of Fas-Tronics,  Inc.  ("Fas-Tronics"),  a
privately owned company.


                                        8
<PAGE>


                   QUESTRON TECHNOLOGY, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)


         The purchase price for Fas-Tronics consisted of:

                  (i)      $7,422,803 in cash;
                  (ii)     421,941 shares of the Company's common stock,  valued
                           at $1,930,380; and
                  (iii)    up to  $4,000,000  (80% in cash and 20% in  shares of
                           the Company's  common stock) if  Fas-Tronics  attains
                           certain earnings targets for the twelve months ending
                           June 30, 1999.

         The  acquisition  of  Fas-Tronics  was  effected  pursuant  to a  Stock
Purchase Agreement dated as of June 12, 1998, as amended, with an effective date
of July 1, 1998.  The  Company  has  accounted  for such  acquisition  using the
purchase method of accounting. In connection with this acquisition,  the Company
recorded $6,713,103 of cost in excess of net assets of the business acquired.

Note 8.           Acquisition of Fortune Industries, Inc.

         In September 1998, the Company completed the acquisition of 100% of the
issued and outstanding capital stock of Fortune Industries,  Inc. ("Fortune"), a
privately owned company.

         The purchase price for Fortune consisted of:

                  (i)      $9,830,660 in cash;
                  (ii)     518,102 shares of the Company's common stock,  valued
                           at $2,370,317; and
                  (iii)    up to  $2,000,000  (81% in cash and 19% in  shares of
                           the  Company's   common  stock)  if  Fortune  attains
                           certain earnings targets for the year ending December
                           31, 1998.

         The  acquisition  of Fortune was effected  pursuant to a Stock Purchase
Agreement dated as of June 12, 1998, as amended,  with an effective date of July
1, 1998.  The Company has  accounted  for such  acquisition  using the  purchase
method of accounting. In connection with this acquisition,  the Company recorded
$9,491,148 of cost in excess of net assets of the business acquired.


                                       9

<PAGE>


                   QUESTRON TECHNOLOGY, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)


Note 9.           Acquisitions - Pro forma Financial Information.

         The  following  unaudited pro forma  information  presents the combined
operating  results of the Company,  Webb,  CalFast,  Fas-Tronics  and Fortune as
though each of the  acquisitions had been made on January 1, 1997. The unaudited
pro forma  combined  summary of  operations  includes  the  additional  interest
expense on debt incurred in connection with the  acquisitions as if the debt had
been outstanding from the beginning of the periods presented.  The pro forma net
income per common  share and diluted  common share for both 1998 and 1997 assume
that  all  shares  of  common  stock  and  Series  IV  Warrants  of the  Company
outstanding  as of September  30, 1998 were  outstanding  as of January 1, 1997.
This pro forma  information does not purport to be indicative of what would have
occurred had the  acquisitions  been  completed as of January 1, 1997 or results
which may occur in the future:
<TABLE>
<CAPTION>

                                           Three months ended                       Nine months ended
                                             September 30,                            September 30,
                                  -------------------------------------   ---------------------------------------
<S>                                <C>                <C>                  <C>                <C> 
                                        1998               1997                 1998               1997
                                 ------------------   ------------------   ------------------ --------------------

Sales                             $   17,799,542        $  14,514,520        $   50,031,939     $   40,475,535
                                  -----------------  -----------------    ------------------ ------------------

Operating income                         3,086,160          2,141,451             8,940,142          6,325,007
                                  -----------------  -----------------    ------------------ ------------------

Net income                         $     1,035,497    $       622,881       $     3,186,454   $      1,828,974
                                  =================  =================    ================== ==================

Net income                         $     1,035,497    $       622,881       $     3,186,454   $      1,828,974
Less:
   Preferred stock dividends                99,185             33,063               165,311             99,189
   Imputed non-cash dividend               663,510            192,329             1,075,988            346,304
                                  -----------------  -----------------    ------------------ ------------------

Net income used in per
   Common share calculation        $       272,802     $      397,489        $    1,945,155    $     1,383,481
                                  =================  =================    ================== ==================

Pro forma net income per common share (*)  $   .06            $   .13               $   .41            $   .45
                                           ========           ========              ========           ========

Pro forma net income per diluted common
   share (*)                               $   .06            $   .12               $   .41            $   .42
                                           ========           ========              ========           ========

Average number of common shares
   outstanding                           4,738,766          3,050,633             4,723,052          3,050,633
                                  =================  =================    ================== ==================

Average number of diluted
   common shares outstanding             4,807,210          5,205,594             5,431,048          4,342,319
                                  =================  =================    ================== ==================
</TABLE>

(*) Pro forma net income per common  share and pro forma net income per  diluted
common  share for the three and nine month  periods  ended  September  30,  1998
reflect deductions for preferred stock dividends,  including one-time,  non-cash
dividends  associated  with the conversion of preferred stock into common stock.
Before such deductions,  pro forma net income per common share was $.22 and $.67
for the three and nine month periods ended September 30, 1998, respectively, and
pro forma net income per  diluted  common  share was $.22 and $.59 for the three
and nine month periods ended September 30, 1998, respectively.

                                       10

<PAGE>

                   QUESTRON TECHNOLOGY, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)



Note 10. Revolving Credit Facility and Long-Term Debt.

         In connection with the  acquisitions  of Fas-Tronics  and Fortune,  the
Company  entered into a Loan and Security  Agreement with Madeleine  L.L.C.  and
Congress  Financial  Corporation   (Florida).   The  agreement  provides  for  a
$45,000,000 credit facility  consisting of a five-year term loan for $30,000,000
and a $15,000,000  revolving credit facility.  The term loan is divided into two
notes:  Note A for  $25,000,000  and Note B for  $5,000,000.  The loan agreement
includes a provision for the calculation of a borrowing base,  which  determines
the amount of borrowings  available under the revolving  facility.  At September
30, 1998, $472,596 was borrowed and outstanding under the revolving facility. Of
the  remaining  amount  of  the  $15,000,000   revolving  credit  facility,   or
$14,527,404,  $14,205,294 was available at September 30, 1998 for future working
capital  needs.  Interest on the revolving  facility is due monthly at the prime
rate plus 1%, with a minimum  rate of interest of 9% per annum.  Interest on the
five-year  term loan Note A is due  monthly  at the prime  rate plus 1.5% with a
minimum rate of interest of 9.5% per annum.  Interest on the five-year term loan
Note B is due monthly at the prime rate plus 3% with a minimum  rate of interest
of 11% per annum.








                                       11
<PAGE>


Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Results of Operations

For the three month and nine month periods ended September 30, 1998.

         The  results of  operations  through  September  30,  1998  include the
operating  results of the Company's  inventory  logistics  management  business,
Questron  Distribution  Logistics,  Inc.  ("QDL"),  its master  distribution  of
fasteners business,  Integrated  Material Systems,  Inc. ("IMS") and its lithium
battery and battery pack distribution business,  Power Components,  Inc. (PCI").
QDL includes the operating results of Quest Electronic Hardware, Inc. ("Quest"),
Webb Distribution ("Webb"), California Fasteners, Inc. ("Calfast"), Fas-Tronics,
Inc. ("Fas-Tronics") and Fortune Industries, Inc. ("Fortune").

         The Company's revenues for the three month and nine month periods ended
September 30, 1998 amounted to $17,799,542 and $38,871,478,  respectively, which
represent a record level of revenues for the Company,  compared with  $6,645,650
and $15,738,987 for the comparable prior year periods. The significant growth in
the  Company's  revenues  for such  periods  is  primarily  attributable  to the
acquisitions of Calfast, Fas-Tronics and Fortune, as well as the internal growth
of the other QDL branches  and the opening of a new QDL branch in Grand  Rapids,
MI during the second quarter of 1998. The revenues  associated with the acquired
businesses  of  Calfast,  Fas-Tronics  and  Fortune for the three and nine month
periods  ended  September  30, 1998  amounted  to  $9,957,463  and  $17,136,913,
respectively,  compared  with $939,119 for both the three and nine month periods
ended September 30, 1997.

         The  Company's   operating   income  was  $2,763,864  and   $5,877,237,
respectively,  for the three month and nine month  periods  ended  September 30,
1998,  compared  with  operating  income  of  $777,218  and  $1,710,017  for the
comparable  prior year periods.  The increase in operating  income for the three
month and nine  month  periods  ended  September  30,  1998,  compared  with the
comparable  prior year  periods,  is primarily  due to the  increased  operating
income  attributable  to the acquired  businesses,  as well as internal  growth.
Operating  income as a percentage  of sales for the three and nine month periods
ended  September  30, 1998 amounted to 15.5% and 15.1%,  respectively,  compared
with 11.7% and 10.9% for the three month and nine month periods ended  September
30, 1997,  respectively.  This  improvement  is  attributable  to the successful
integration  of the acquired  businesses and the resultant cost savings from the
combination of these businesses with the Company.

         Interest expense, which reflects the cost of borrowings associated with
the acquisition of Calfast in September 1997 and the acquisitions of Fas-Tronics
and  Fortune as of July 1, 1998,  as well as  borrowings  associated  with QDL's
working  capital  needs,  for the  three  month  and nine  month  periods  ended
September 30, 1998 amounted to $1,008,785 and $1,621,558,  respectively. For the
comparable  periods of the prior year, the Company's  results  include  interest
expense of $79,433 and $206,532,  respectively. The increase in interest expense
principally reflects the costs of increased borrowings to

                                       12
<PAGE>


complete the acquisitions of Calfast,  Fas-Tronics and Fortune,  and to support
the working capital needs of QDL.

         The  provision  for  income  taxes for the three  month and nine  month
periods  ended  September  30, 1998 and 1997,  respectively,  reflects a federal
income tax provision at an effective rate of 35% and 35.1%, respectively,  and a
state income tax  provision at an effective  rate of 6% and 6.2%,  respectively,
for the states in which the Company does business.

         Net income for the three month and nine month periods  ended  September
30, 1998 amounted to $1,035,497 and $2,510,851,  respectively, compared with net
income of $409,600 and  $882,546 for the  comparable  prior year  periods.  This
improvement reflects the increased operating income attributable to the acquired
businesses, as well as continued internal growth, partially reduced by increased
corporate expenses, interest expense, and income taxes.

         Net  income  per  share  reflects  a  deduction  for  preferred   stock
dividends,  including one-time, non-cash dividends associated with the automatic
conversion of preferred  stock into common stock.  The preferred stock converted
into common stock on July 2, 1998,  causing the acceleration of the amortization
of the imputed one-time, non-cash dividend.  Accordingly,  the common stock into
which the  preferred  stock  converted  (1,653,125  shares  of common  stock) is
included in the common shares  outstanding  for the three months ended September
30,  1998 and is  included  for one quarter in the  weighted  average  number of
common shares  outstanding  for the nine months ended  September  30, 1998.  The
effect of this one-time,  non-cash dividend is anti-dilutive,  accordingly,  the
presentation  of net income per diluted common share is presented on the face of
the income  statement as the same amount as net income per common share.  Before
such  deduction,  however,  the net income per diluted  common share is $.22 and
$.52  for  the  three  months  and  nine  months  ended   September   30,  1998,
respectively.  Net  income per common  share and net income per  diluted  common
share in the  fourth  quarter  of 1998  will not be  impacted  by such  non-cash
dividends.

Liquidity and Capital Resources

         At September 30, 1998,  the Company had $87,587 in cash and  short-term
investments,  compared to $875,080 as of December 31, 1997.  As of September 30,
1998,  the Company had working  capital of  $18,411,641,  compared  with working
capital of $9,046,826 as of December 31, 1997.

         For the nine months ended  September 30, 1998, the net cash used by the
Company's operating  activities amounted to $1,388,090,  principally  reflecting
the increase in  inventories,  receivables,  prepaid  expenses and other assets,
offset in part by the  profits of the  Company  and the  increases  in  accounts
payable, accrued expenses, income taxes payable and deferred income taxes.

         For the nine months ended  September 30, 1998, the net cash used in the
Company's investing  activities amounted to $18,241,203,  including  $17,066,558
net cash

                                       13

<PAGE>

consideration  paid in  connection  with the  acquisitions  of  Fas-Tronics  and
Fortune and $600,000 net cash consideration paid in connection with the deferred
purchase price of Calfast.  The Company also had capital  expenditures  $568,679
for the acquisition of fixed assets,  $392,040 of which  represents the purchase
and installation of a new on-line,  real-time  computer system. The Company does
not have  significant  commitments for capital  expenditures as of September 30,
1998 and no significant commitments are anticipated for the next twelve months.

         For the nine months ended  September 30, 1998, the net cash provided by
the Company's financing  activities  amounted to $18,841,800,  which consists of
$30,000,000 of bank financing  associated  with the  acquisitions of Fas-Tronics
and  Fortune  and the  refinancing  of existing  bank debt,  $5,647,799  of bank
borrowings under the Company's revolving credit facility, as well as $371,228 of
net proceeds  from a capital  lease for the purchase of the  Company's  computer
system,  reduced by long-term debt principal  payments of $9,583,334,  revolving
facility  repayments of $5,472,340,  fees and expenses  associated with the bank
financing of $1,976,300, principal payments of $63,943 on various capital leases
and principal payments of $81,310 on notes issued for acquired businesses.

         In connection with the  acquisitions  of Fas-Tronics  and Fortune,  the
Company  entered into a $45,000,000  Loan and Security  Agreement with Madeleine
L.L.C. and Congress Financial  Corporation  (Florida) providing for term debt of
$30,000,000 and a revolving  credit  facility of  $15,000,000.  At September 30,
1998, $472,596 was borrowed and outstanding under the revolving facility. Of the
remaining amount of the $15,000,000  revolving credit facility,  or $14,527,404,
$14,205,294  was  available at  September  30, 1998 for future  working  capital
needs.  Amounts outstanding under the revolving facility bear interest at a rate
equal to 1.0% above the  lender's  prime rate with a minimum rate of interest of
9% per annum.  As of November 10, 1998,  the interest  rate under the  revolving
facility  was 9%. In order to secure  the  obligations  of the  Company  and its
subsidiaries  under the  revolving  facility and the related term loan  facility
under the loan and security  agreement with the lender, the Company entered into
a stock  pledge  agreement  with the lender  whereby the Company  pledged to the
lender the shares of capital  stock of each of its  subsidiaries  at the date of
such  agreement  and any shares of its  subsidiaries  in which the  Company  may
thereafter  acquire an interest.  In addition,  the Company and its subsidiaries
granted a security interest in substantially all of their assets to the lender.

         The Company  intends to continue to  identify  and  evaluate  potential
merger and acquisition  candidates  engaged in businesses  complementary  to its
business.  While certain of such additional potential acquisition  opportunities
are at various stages of consideration and evaluation, none is at any definitive
stage  at this  time.  Management  believes  that  its  working  capital,  funds
available under its credit  agreement,  and funds generated from operations will
be  sufficient  to  meet  its  obligations  through  1999,   exclusive  of  cash
requirements associated with any business acquisitions.

         Certain  information  contained in this report on Form 10-QSB  includes
"Forward-Looking  Statements"  within  the  meaning  of the  Private  Securities
Litigation Reform Act 

                                       14
<PAGE>


of 1995 and is subject to certain risks and uncertainties, including those "Risk
Factors" set forth in the Company's current annual report on Form 10-KSB for the
year ended December 31, 1997.  Readers are cautioned not to place undue reliance
on these forward-looking  statements which speak only as of the date hereof. The
Company  undertakes  no  obligation  to release  publicly any revisions to these
forward-looking  statements to reflect  events or  circumstances  after the date
hereof or to reflect unanticipated events or developments.

Readiness for Year 2000 Compliance

         The Year 2000  presents  potential  concerns  for business and consumer
computing.  The  consequences  of this issue may include  systems  failures  and
business  process  interruption.  It may also  include  additional  business and
competitive differentiation. Aside from the well-known calculation problems with
the use of 2-digit date formats as the year changes from 1999 to 2000,  the Year
2000  is a  special  case  leap  year  and in  many  organizations  using  older
technology, dates were used for special programmatic functions.

         The  Year  2000  issue  may  affect  the  Company's  internal  systems,
including information technology (IT) and non-IT systems. While the Company's IT
system is prepared  to handle all dating  implications  associated  with the new
millenium,   the  Company's  management  is  presently  engaged  in  an  ongoing
assessment  of the  readiness  of all its  systems for  handling  the Year 2000.
Although the assessment is still underway, management currently believes that it
will be successful in identifying  and resolving any potential  deficiencies  in
its non-IT systems with respect to the Year 2000 issue by June 1999 and that all
such  material  systems  will be compliant by the Year 2000 and that the cost to
address the issues is not material.  Nevertheless, the Company expects to assess
its need to create contingency plans during 1999 for certain internal systems in
the  event  management   determines  that  such  contingency  plans  may  become
warranted.

         All  organizations  dealing  with the Year 2000 issue must  address the
effect this issue will have on their third-party supply chain. The Company plans
to also  undertake  steps to  identify  whether its  vendors  have  sufficiently
identified  and are taking steps to address the Year 2000 issue.  Management  is
presently  formulating a survey and plan for working with key  third-parties  to
understand their ability to continue providing services and products through the
change  to  2000.   The  Company  will  work  directly  with  its  key  vendors,
distributors,  and resellers, and coordinate its action with respect to the Year
2000 issue with them, if necessary, to avoid any business interruptions in 2000.
For these key third-parties, contingency plans may be required.

         The Company's  management  believes the impact of the Year 2000will not
cause any material disruptions in the Company's operations.  However, the impact
of such potential disruptions is difficult to discern.

                                       15

<PAGE>



                           PART II - OTHER INFORMATION


Item  1.          LEGAL PROCEEDINGS

                  Not applicable.

Item 2.           CHANGES IN SECURITIES

                  On June  30,  1998,  the  Company  filed an  amendment  to the
Certificate  of  Designation  of the Company with the  Secretary of State of the
State of  Delaware,  providing  that (i) each  share of the  Company's  Series B
Convertible  Preferred  Stock, par value $.01 per share (the "Series B Preferred
Stock") would automatically  convert as of the close of business on July 2, 1998
(the "Conversion Date"), without any action on the part of the holder thereof or
the  Company,  into 1.4375  shares of common  stock,  par value  $.001  ("Common
Stock");  (ii) holders of the Series B Preferred  Stock would be entitled,  when
and as  declared by the Board of  Directors  of the Company  (the  "Board"),  to
receive an annual  dividend  per share  equal to $0.115  per  share;  (iii) such
dividends  would accrue from March 4, 1997 and would be payable on March 4, 1998
and on the  Conversion  Date (payable  with respect to a full year),  in cash or
shares of Common Stock of the Company;  (iv) the aforementioned  dividends would
be  cumulative  and no  dividends  would be paid or set apart in  respect of the
Common Stock or any other class of securities which ranks junior to the Series B
Preferred  Stock  unless and until all  accrued and unpaid  dividends  upon such
Series B Preferred Stock had been paid or set apart in full; and (v) no interest
would accrue with respect to dividends in arrears.

                  On the Conversion Date, each share of Series B Preferred Stock
was  converted  into Common Stock at a rate of 1.4375 shares of Common Stock and
received $0.115 per share in Common Stock for the related dividend.

                  On  October  23,  1998,  the  Board  (i)  created  a series of
preferred  stock, par value $.01 per share, of the Company (the "Series A Junior
Participating  Preferred  Stock"),  with the  designation  and  number of shares
thereof and other powers, preferences and relative,  participating,  optional or
other  rights of the shares of such series and the  qualifications,  limitations
and restrictions thereof set forth in the Certificate of Designation of Series A
Junior Participating Preferred Stock of the Company, filed with the Secretary of
State of the State of Delaware on November 5, 1998 and (ii)  declared a dividend
of one preferred share purchase right (a "Right") for each outstanding  share of
common stock,  par value $.001 per share,  of the Company (the "Common  Stock").
The dividend is payable to  stockholders  of record on November  16, 1998.  Each
Right  entitles  the  registered   holder  to  purchase  from  the  Company  one
one-thousandth of a share of Series A Junior Participating  Preferred Stock, par
value $.01 per share, of the Company (the  "Preferred  Stock") at a price of $30
per one one-thousandth of a share of Preferred Stock, subject to adjustment.

                  The  description  and terms of the  Rights  are set forth in a
Rights  Agreement  dated as of October 23, 1998, as the same may be amended from
time to time (the "Rights  Agreement"),  between the Company and American  Stock
Transfer & Trust  Company,  as Rights  Agent (the  "Rights  Agent").  The Rights
Agreement  provides that,  until the earlier to occur of (i) 10 days following a
public  announcement that a person or group of affiliated or associated  persons
(with  certain  exceptions,  an  "Acquiring  Person")  has  acquired  beneficial
ownership  of 15% or more of the  outstanding  shares of Common Stock or (ii) 10
business days (or such later date as may be determined by action of the Board of
Directors  prior to such  time as any  person  or group  of  affiliated  persons
becomes an Acquiring  Person)  following the commencement of, or announcement of
an intention to make, a tender offer or exchange offer the consummation of which
would result in the beneficial  ownership by a person or group of 15% or more of
the  outstanding  shares of Common Stock (or earlier  expiration of the Rights),
the Rights will be  transferred  with and only with the Common Stock.  A copy of
the Rights Agreement was filed with the Securities and Exchange Commission as an
Exhibit to a Registration Statement on Form 8-A with the Securities and Exchange
Commission on November 6, 1998.

Item 3.           DEFAULTS UPON SENIOR SECURITIES

                  Not applicable.

Item 4.           SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                  Not applicable

Item 5.           OTHER INFORMATION

                  Not applicable.

Item 6.           EXHIBITS AND REPORTS ON FORM 8-K

                  a)   Exhibits.
                       See Exhibit Index immediately following the signature 
                       page.
                  b)   Reports on Form 8-K.

                      During the fiscal  quarter ended  September 30, 1998,  the
                      Company  filed  a  Current   Report  on  Form  8-K,  dated
                      September   24,   1998,   (i)   reporting   under  Item  2
                      "Acquisition or Disposition of Assets" the acquisitions of
                      Fas-Tronics,   Inc.  a  Texas  corporation,   and  Fortune
                      Industries,  Inc.,  a Texas  corporation,  (ii)  reporting
                      under  Item  4   "Changes   in   Registrant's   Certifying
                      Accountant" the termination of Moore Stephens, P.C. as the
                      Company's  independent  accountant and the  appointment of
                      Ernst  &  Young  LLP  as  the  Company's  new  independent
                      accountant  and (iii)  including  under Item 7  "Financial
                      Statements and Exhibits" the Amendment to the  Fas-Tronics
                      Stock  Purchase  Agreement,  the  Amendment to the Fortune
                      Stock  Purchase  Agreement  and  the  Registration  Rights
                      Agreement  relating  to the  events  described  in Item 2,
                      together  with the  press  release  relating  to the event
                      reported in Item 4.




                                       16
<PAGE>

                                   SIGNATURES

         In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                          QUESTRON TECHNOLOGY, INC.


                                       (1)  Principal Executive Officer:

Date:       November 16, 1998                   /s/ Dominic A. Polimeni
                                                ------------------------------
                                                Dominic A. Polimeni
                                                Chief Executive Officer

                                       (2)  Principal Financial and Accounting
                                               Officer:

Date:       November 16, 1998                   /s/ Milton M. Adler
                                                ------------------------------
                                                Milton M. Adler
                                                Treasurer



                                       17

<PAGE>



                                  EXHIBIT INDEX


       The following exhibits are filed as part of this quarterly report on Form
10-Q:



<TABLE>
<CAPTION>
Exhibit                                                                                             Sequential
  No.                                        Description                                             Page No.
  ---                                        -----------                                             --------

<S>            <C>
3.0            Certificate  of  Incorporation,   incorporated  by  reference  to
               Exhibit  3(i) to the  Registrant's  Form  10-KSB  filed  with the
               Securities  and  Exchange  Commission  for the fiscal  year ended
               December 31, 1987 (File No. 0-13324)
3.1            Certificate of Amendment, dated March 20, 1985, to Certificate of
               Incorporation  of the  Registrant,  incorporated  by reference to
               Exhibit 4.1 to Amendment No. 1 of the  Registrant's  Registration
               Statement  on Form S-3 filed  with the  Securities  and  Exchange
               Commission on March 9, 1995 (File No. 33-44331)
3.3            Certificate  of Amendment,  dated June 9, 1989, to Certificate of
               Incorporation  of the  Registrant,  incorporated  by reference to
               Exhibit 4.1 to Amendment No. 1 of the  Registrant's  Registration
               Statement  on Form S-3 filed  with the  Securities  and  Exchange
               Commission on March 9, 1995 (File No. 33-44331)
3.4            Certificate of Correction,  dated May 17, 1991, to Certificate of
               Incorporation  of the  Registrant,  incorporated  by reference to
               Exhibit 4.1 to Amendment No. 1 of the  Registrant's  Registration
               Statement  on Form S-3 filed  with the  Securities  and  Exchange
               Commission on March 9, 1995 (File No. 33-44331)
3.5            Certificate of Amendment, dated December 20, 1993, to Certificate
               of Incorporation of the Registrant,  incorporated by reference to
               Exhibit  3(i) to the  Registrant's  Form  10-KSB  filed  with the
               Securities  and  Exchange  Commission  for the fiscal  year ended
               December 31, 1993 (File No. 0-13324)
3.6            Certificate of Correction, dated July 19, 1994, to Certificate of
               Incorporation  of the  Registrant,  incorporated  by reference to
               Exhibit 4.1 to Amendment No. 1 to the  Registrant's  Registration
               Statement  on Form S-3 filed  with the  Securities  and  Exchange
               Commission on March 9, 1995 (File No. 33-44331)
3.7            Certificate of Amendment,  dated April 2, 1996, to Certificate of
               Incorporation  of the  Registrant,  incorporated  by reference to
               Exhibit  3.5 to the  Registrant's  Form  10-KSB  filed  with  the
               Securities  and  Exchange  Commission  for the fiscal  year ended
               December 31, 1995 (File No. 0-13324)
</TABLE>
<PAGE>



<TABLE>
<CAPTION>
Exhibit                                                                                             Sequential
  No.                                        Description                                             Page No.
  ---                                        -----------                                             --------

<S>            <C>    
3.8            Certificate of Amendment, filed December 31, 1996, to Certificate
               of Incorporation of the Registrant,  incorporated by reference to
               Exhibit 3.10 to  Amendment  No. 1 to the  Registrant's  Form SB-2
               filed with the Securities and Exchange Commission on February 25,
               1997 (File No. 333-18243)
3.9            By-Laws of the  Registrant,  incorporated by reference to Exhibit
               3b(ii) to the Registrant's  Form 10-KSB filed with the Securities
               and Exchange  Commission  for the fiscal year ended  December 31,
               1987 (File No. 0-13324)
3.10           Amendment to By-Laws of the Registrant, incorporated by reference
               to Exhibit 3.4 of the  Registrant's  Form  10-KSB  filed with the
               Securities  and  Exchange  Commission  for the fiscal  year ended
               December 31, 1992 (File No. 0-13324)
4.0            Specimen Common Stock  Certificate,  incorporated by reference to
               Exhibit  4.0 to  Amendment  No. 1 to the  Registrant's  Form SB-2
               filed with the Securities and Exchange Commission on February 25,
               1997 (File No. 333-18243)
4.1            Specimen Preferred Stock  Certificate,  incorporated by reference
               to Exhibit 4.1 to Amendment No. 1 to the  Registrant's  Form SB-2
               filed with the Securities and Exchange Commission on February 25,
               1997 (File No. 333-18243)
4.2            Certificate  of  Designations,  Preferences  and  Rights  of  the
               Registrant's Series B Convertible  Preferred Stock,  incorporated
               by  reference   to  Exhibit  4.2  to  Amendment   No.  1  to  the
               Registrant's  Form SB-2 filed with the  Securities  and  Exchange
               Commission on February 25, 1997 (File No. 333-18243)
4.3            Form of Series IV Warrant Agreement, incorporated by reference to
               Exhibit  4.3 to  Amendment  No. 1 to the  Registrant's  Form SB-2
               filed with the Securities and Exchange Commission on February 25,
               1997 (File No. 333-18243)
4.4            Form of Series III  Warrant  Agreement,  dated as of  November 7,
               1994,   incorporated   by  reference  to  Exhibit  10.22  to  the
               Registrant's  Form 10-K filed with the  Securities  and  Exchange
               Commission  for the fiscal year ended December 31, 1994 (File No.
               0-13324)
4.5            Form of Underwriters' Purchase Option,  incorporated by reference
               to Exhibit 4.5 to Amendment No. 1 to the  Registrant's  Form SB-2
               filed with the Securities and Exchange Commission on February 25,
               1997 (File No. 333-18243)
4.6            Stock Purchase  Warrant  Certificate for Purchase of Common Stock
               of  Questron  Technology,  Inc.,  incorporated  by  reference  to
               Exhibit  4.6 to  Amendment  No. 1 to the  Registrant's  Form SB-2
               filed with the Securities and Exchange Commission on February 25,
               1997 (File No. 333-18243)
4.7            Amended  Certificate  of  Designation  Establishing  a Series  of
               Preferred  Stock of Questron  Technology,  Inc.,  incorporated by
               reference to Exhibit 4.7 to the Registrant's  Quarterly Report on
               Form 10-Q/SB for the three-month period ended June 30, 1998 (File
               No. 0-13324)
4.8            Registration Rights Agreement, dated as of September 24, 1998, by
               and between  the  Company  and the  persons  listed on Schedule A
               thereto,  incorporated  by  reference  to the  Company's  current
               report  on Form  8-K,  filed  with the  Securities  and  Exchange
               commission on October 8, 1998 (File No. 0-13324).
4.9            Certificate  of  Designation  of  Series A  Junior  Participating
               Preferred Stock of Questron Technology, Inc.
10.1           1996 Stock  Option  Plan,  incorporated  by  reference to Exhibit
               10.19 to Amendment No. 1 to the Company's  Registration Statement
               on Form SB-2 filed with the Securities and Exchange Commission on
               February 25, 1997 (File No. 333-18243)
10.2           Exchange  Agreement,  dated  November  8,  1996 by and  among the
               Company,   Gulfstream   Financial  Group,  Inc.  and  Phillip  D.
               Schwiebert,   incorporated  by  reference  to  Exhibit  10.21  to
               Amendment  No. 1 to the  Registrant's  Registration  Statement on
               Form SB-2 filed with the  Securities  and Exchange  Commission on
               February 25, 1997 (File No. 333-18243)
10.3           Stock Purchase  Agreement  dated as of December 16, 1996 relating
               to Webb Distribution,  Inc., incorporated by reference to Exhibit
               2.0 to Amendment No. 1 to the Company' Registration  Statement on
               Form SB-2 filed with the  Securities  and Exchange  Commission on
               February 25, 1997 (File No. 333-18243).
10.4           Form of  Underwriting  Agreement,  incorporated  by  reference to
               Exhibit  2.0 to  Amendment  No. 1 to the  Company's  Registration
               Statement  on Form SB-2 filed with the  Securities  and  Exchange
               Commission on February 25, 1997 (File No. 333-18243).
10.5           Stock Option Grant  Agreement  between the Company and Gulfstream
               Financial Group,  Inc. made as of November 8, 1996,  incorporated
               by reference to Exhibit 10.22 to the  Registrant's  Annual Report
               on Form 10-KSB filed with the Securities and Exchange  Commission
               for the fiscal year ended December 31, 1996 (File No. 0-13324).
10.6           Stock Option Grant  Agreement  between the Company and Phillip D.
               Schwiebert made as of November 8, 1996, incorporated by reference
               to Exhibit  10.23 to the  Company's  Annual Report on Form 10-KSB
               filed with the Securities and Exchange  Commission for the fiscal
               year ended December 31, 1996 (File No. 0-13324).
10.7           Amendment  No.  4,  dated as of April  9,  1997,  to the Loan and
               Security  Agreement,  dated as of March 31, 1995, between Silicon
               Valley Bank and Quest Electronics Hardware, Inc., incorporated by
               reference to Exhibit 10.1 to the  Company's  Quarterly  Report on
               Form 10-QSB for the three month period ended March 31, 1997 (File
               No. 0-13324).
10.8           Stock Purchase  Agreement dated as of August 29, 1997 relating to
               the  acquisition  of all of the  outstanding  stock of California
               Fasteners,  Inc.,  incorporated  by  reference  to the  Company's
               Current  Report  on Form 8-K  filed  October  7,  1997  (File No.
               0-13324).
10.9           Asset Purchase  Agreement dated September 4, 1997 relating to the
               acquisition  of   substantially   all  of  the  assets  of  Power
               Components,  Inc. with the related Stock Purchase Agreement dated
               September 4, 1997 relating to the acquisition of all of the stock
               of AR Acquisition  Company,  incorporated by reference to Exhibit
               10.1 to the  Company's  Quarterly  Report on Form  10-QSB for the
               three month period ended September 30, 1997 (File No. 0-13324).
10.10          Stock  Purchase  Agreement,  dated  as of June 12,  1998,  by and
               between the Company,  Gregory Fitzgerald,  Valerie Fitzgerald and
               Fas-Tronics,  Inc.,  incorporated by reference to Exhibit 10.2 to
               the Company's Quarterly Report on Form 10-QSB for the three month
               period ended June 30, 1998 filed with the Securities and Exchange
               Commission on August 14, 1998 (File No. 0-13324).
10.11          Stock  Purchase  Agreement,  dated  as of June 12,  1998,  by and
               between  the   Company,   Fortune   Industries,   Inc.   and  the
               Stockholders  of the Company  listed on Schedule 1.1 thereto (the
               "Fortune Stock Purchase Agreement"), incorporated by reference to
               Exhibit 10.1 to the Company's Quarterly Report on Form 10-QSB for
               the  three  month  period  ended  June 30,  1998  filed  with the
               Securities  and Exchange  Commission on August 14, 1998 (File No.
               0-13324).
10.12          Letter  Agreement,  dated  July  29,  1998,  by and  between  the
               Company, Gregory Fitzgerald,  Valerie Fitzgerald and Fas-Tronics,
               Inc.,  incorporated by reference to Exhibit 10.4 to the Company's
               Quarterly  Report on Form 10-QSB for the three month period ended
               June 30, 1998 filed with the Securities  and Exchange  Commission
               on August 14, 1998 (File No. 0-13324).
10.13          Letter  Agreement,  dated  July  29,  1998,  by and  between  the
               Company,  Fortune  Industries,  Inc. and the  Stockholders of the
               Company  listed on  Schedule  1.1 to the Fortune  Stock  Purchase
               Agreement,  incorporated  by  reference  to  Exhibit  10.3 to the
               Company's  Quarterly  Report on Form  10-QSB for the three  month
               period ended June 30, 1998 filed with the Securities and Exchange
               Commission on August 14, 1998 (File No. 0-13324).
10.14          Second  Amendment to the  Fas-Tronics  Stock Purchase  Agreement,
               incorporated by reference to the Company's Current Report on Form
               8-K filed with the Securities and Exchange  Commission on October
               8, 1998 (File No. 0-13324).
10.15          Second  Amendment  to  the  Fortune  Stock  Purchase   Agreement,
               incorporated by reference to the Company's Current Report on Form
               8-K filed with the Securities and Exchange  Commission on October
               8, 1998 (File No. 0-13324).
10.16          Rights  Agreement  dated as of  October  23,  1998,  between  the
               Company and American Stock  Transfer & Trust  Company,  as Rights
               Agent,  incorporated  by reference to the Company's  Registration
               Statement on Form 8-A, filed November 6, 1998 (File No. 0-13324).
10.17          Loan and Security  Agreement  dated as of September  24, 1998, by
               and among the Company,  Questron  Distribution  Logistics,  Inc.,
               Integrated  Material  Systems,  Inc.,  Power  Components,   Inc.,
               California Fasteners,  Inc., Comp Ware, Inc., Fas-Tronics,  Inc.,
               Fortune  Industries,  Inc.,  each of the  signatories  which is a
               signatory thereto,  Congress Financial Corporation (Florida),  as
               administrative  agent and Madeleine  L.L.C., as collateral agent.
10.18          Amendment Number One to the Loan and Security Agreement, dated as
               of  November  2,  1998,  by  and  among  the  Company,   Questron
               Distribution Logistics,  Inc., Integrated Material Systems, Inc.,
               Power Components,  Inc., California  Fasteners,  Inc., Comp Ware,
               Inc.,  Fas-Tronics,  Inc., Fortune Industries,  Inc., each of the
               Lenders,    Congress   Financial   Corporation   (Florida),    as
               Administrative Agent and Madeleine L.L.C., as Collateral Agent.
27.1           Financial Data Schedule
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