<PAGE>
                                 UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549
                                    FORM 10K
               ANNUAL REPORT PURSUANT TO SECTION 13 OR 15D OF THE
                       SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended July 31, 1997
                          Commission File No. 0-3825

                       COMPUTER TRANSCEIVER SYSTEMS, INC.
                           (Exact name of registrant
                          as specified in its charter)
               New York                                       22-1842747 
   (State of Incorporation)                (IRS Employer Identification Number)

           23 Carol Street
        Clifton, New Jersey                                   07014-0996
       (Address of principal                                  (Zip code)
         executive offices)
                                 (201) 473-4700       
                         (Registrant's telephone number
                               including area code)

              Securities registered pursuant to Section 12(b) of the Act:
                                    Not Applicable
 	Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock, par value $.001 per share

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 of 15(d) of the Securities Exchange Act of
1934 during the preceding 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 [  ]

The aggregate market value of the registrant's Common Stock held by
non-affiliates of the registrant as of October 20, 1997 as $27,166.

The number of shares outstanding of the registrant's class of Common Stock as
of October 20, 1997 is 2,716,603.

                           Documents Incorporated by Reference:

Proxy Statement and Exchange Offer/Prospectus dated July 28, 1994, effective
July 28, 1994, on Form S-4, SEC File No. 33-76378; such document relates to
Parts I, II, III and IV of this Annual Report.
<PAGE> 
                                             PART I
ITEM 1.  BUSINESS.

Sale of Assets to Vertex
On August 31, 1994, Computer Transceiver Systems, Inc. ("CTSI" or the
"Company") completed the sale of all of its assets to its corporate parent,
Vertex Industries, Inc. ("Vertex"), which assumed all of CTSI's liabilities.
The purchase price for the assets was $1,699,580.  The Company's net
indebtedness to Vertex of $1,257,001 was offset against the purchase price,
leaving a balance of $442,579.  This balance was paid by the issuance to CTSI
of 236,042 shares of Vertex common stock.  CTSI subsequently distributed 
233,170 shares of Vertex Common stock in an exchange offer for 746,161 shares 
of CTSI's Common Stock.

The Vertex shares reflected in the balance sheet as marketable securities as of
July 31, 1997 represents 2,872 shares which were not distributed to the CTSI
shareholders.  The Exchange Offer, resulted in the exchange of 746,161 CTSI
shares for Vertex shares, and a reduction in CTSI's outstanding shares from
3,462,764 to 2,716,603.

General
Prior to the sale of its assets to Vertex, CTSI supplied and supported an
intelligent bar code printing system, the Execuport 2400, intended for various
applications within the automatic identification market.  CTSI previously
developed, produced and marketed a number of versions of the Execuport 2400,
sales of which have been made primarily to medical and healthcare customers in
recent years.  Vertex, has recently been manufacturing the Execuport 2400 for
CTSI and will continue to produce and support it.

Servicing
The Execuport 2400 has been serviced at the Company's facilities in Clifton,
New Jersey. Product warranties and servicing are now offered by Vertex.

Trademarks and Patents
The "Execuport" name is a registered trademark.  CTSI has not enjoyed
patent protection on the Execuport 2400 but regards various aspects of the
2400's design and software as proprietary.  All of CTSI's intellectual property
rights in connection with the Execuport 2400 have been transferred to Vertex as
part of the sale of the Company.

Personnel
As a result of the conclusion of its sale of assets to Vertex on August 31,
1994, CTSI no longer has any salaried employees or consultants.

Operations of CTSI After Sale of Assets.
Vertex and CTSI intend to seek out an acquisition and/or merger transaction
between CTSI and an operating company, which, if completed, would enable CTSI
shareholders to participate in another enterprise.  
                                       2
<PAGE>

Since CTSI itself has no operations or significant assets, its future potential
will derive solely from any future business operations it may undertake as the
result of any such subsequent acquisition or merger.  CTSI has not yet received
an acceptable offer of a business combination with any other entity, and cannot
predict whether or when it will receive such offer or, if any offer is 
received, whether such offer will be on reasonable terms. Furthermore, a 
proposal for a business combination with an operating entity may require, prior
to acceptance and consummation, certain regulatory filings, with attendant 
delays and uncertainty.  Accordingly, CTSI shareholders  have an interest in an
inactive company, with no assurance that their CTSI shares will have any value
in the future.

Vertex is responsible for the costs of any continuing CTSI operations, expected
to be minimal, such as the costs of complying with any regulatory and tax
requirements and any expenses associated with pursuing possible merger or
acquisition candidates.


ITEM 2.	PROPERTIES.

CTSI's facilities are located at 23 Carol Street, Clifton, New Jersey.

ITEM 3.	LEGAL PROCEEDINGS.

None

ITEM 4.	SUBMISSION OF MATTER TO A VOTE OF SECURITY HOLDERS.

                                      None

                                     PART II

ITEM 5.	MARKET FOR THE COMPANY'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS.

(a)  Price quotations for the Company's common stock have not been carried in
the NASDAQ system since 1986.  In April 1997 the Company's common stock resumed
trading on the bulletin board under the symbol CPPT.  

(b)  The approximate number of record holders of CTSI common stock as of
October 20, 1997 was 648.

(c)  No dividends have been paid on the Company's common stock.   In view of
the sale of CTSI's assets to its corporate parent, and of the uncertainty of a
future business combination between CTSI and any other entity (see "Operations
of CTSI After Sale of Assets" above), it would appear virtually impossible for
any cash dividends to be paid by CTSI in the foreseeable future.     

                                   
                                      3
<PAGE>
<TABLE>

ITEM 6.         SELECTED FINANCIAL DATA

                      A Summary of Selected Financial Data
                  For the Years Ended July 31, are As Follows:
<CAPTION>           
                                                  1997            1996          1995          1994         1993
<S>                                       <C>              <C>            <C>           <C>           <C>
Operating Revenues                        $        ---     $      ---     $   21,005    $ 1,220,076   $ 1,003,570

Income (loss) before cumulative effect
  of a change in accounting principle     $        ---     $      ---     $  707,274    $    81,210   $   (92,579)

Cumulative effect of a change in
    accounting principle                  $        ---     $      ---     $      ---    $   585,600   $      ---
                                                                  
Net income (loss) for the year            $        ---     $      ---     $  707,274    $   666,810   $   (92,579)

Weighted average number of
    shares outstanding                       2,716,603      2,716,603     2,933,296      3,462,762      3,454,627

Net income (loss) per share before
    cumulative effect of a change in
     accounting principle                 $        ---     $      ---     $      .24    $       .02   $      (.03)

Cumulative effect per share of a change
    in accounting principle               $        ---     $      ---     $      ---    $       .17   $       ---

Net income (loss) per share               $        ---     $      ---     $      .24    $       .19   $      (.03)

Total Assets                              $      3,052     $    3,052     $    3,052    $ 1,043,376   $   381,828

Long-term debt                            $        ---     $      ---     $      ---    $       ---   $       ---

Stockholders' equity (deficit)            $      3,052     $    3,052     $  (39,948)   $  (372,665)  $(1,039,475)

                                             
                                       4
</TABLE>
<PAGE>
ITEM 7.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

	FISCAL YEAR ENDED JULY 31, 1997 COMPARED WITH FISCAL YEAR ENDED
        JULY 31, 1996

	As previously stated, since the acquisition of the Company's assets by
        Vertex Industries, Inc. on August 31, 1994, CTSI has had no operations.


	FISCAL YEAR ENDED JULY 31, 1996 COMPARED WITH FISCAL YEAR ENDED
        JULY 31, 1995

	As previously stated, since the acquisition of the Company's assets by
        Vertex Industries, Inc. on August 31, 1994, CTSI has had no operations.


CAPITAL RESOURCES AND LIQUIDITY

As previously reported, the sale of the Company's assets to Vertex was approved
by the shareholders and became effective August 31, 1994.  All Company
operations have been transferred to Vertex, and the Company's continuing
working capital requirements will be minimal.  Vertex has also assumed all CTSI
liabilities, including responsibility for the cost of compliance with any
regulatory requirements and for taxes and fees.

ITEM 8.  	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

	[The next pages are numbered F-1 through F-9]
                                       
                                       5
<PAGE>
                        COMPUTER TRANSCEIVER SYSTEMS, INC.

                          Index to Financial Statements

                             Year Ended July 31, 1997

                                                                        Page

Reports of Independent  Public Accountants. . . . . . . . . . . . .  .F-2, F-3

Balance Sheets as of July 31, 1997 and July 31, 1996  . . . . . . . ..F-4

Statements of Discontinued Operations for the Years Ended
        July 31, 1997, 1996 and 1995 . . . . . . . . . . . . . . . .  F-5

Statements of Changes in Stockholders' Equity (Deficit)
        for the Years Ended July 31, 1997, 1996 and 1995 . . . . . .  F-6

Statements of Cash Flows for the Years Ended
        July 31, 1997, 1996, 1995 . . . . . . . . . . . . . . . . . ..F-7

Notes to Financial Statements . . . . . . . . . . . . . . . . . . . ..F-8


                                        F-1
<PAGE>
                      REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To The Stockholders and 
	Board of Directors of

                          Computer Transceiver Systems, Inc.


We have audited the accompanying balance sheets of Computer Transceiver 
Systems, Inc. (a New York Corporation) as of July 31, 1997 and  1996 and the 
related statements of discontinued operations, changes in stockholders' 
equity and cash flows for the years then ended.  These financial statements 
are the responsibility of the Company's management.  Our responsibility is to 
express an opinion on these financial statements based on our audits. 

We conducted our audits in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audit to 
obtain reasonable assurance about whether the financial statements are free 
of material misstatements.  An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the financial statements. 
 An audit also includes assessing the accounting principles used and 
significant estimates made by management, as well as evaluating the overall 
financial statement presentation.  We believe that our audits provide a 
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in 
all material respects, the financial position of Computer Transceiver 
Systems, Inc. as of July 31, 1997 and 1996, and the results of its 
discontinued operations and its cash flows for the years then ended, in 
conformity with generally accepted accounting principles.
                       

                                                Arthur Andersen LLP


Roseland, New Jersey
October 7, 1997
                                       F-2
<PAGE>


                Report of Independent Certified Public Accountants


To the Stockholders and Board of Directors of
  Computer Transceiver Systems, Inc.:

	We have audited the accompanying statements of discontinued operations,
changes in stockholders' equity (deficit), and cash flows of Computer
Transceiver Systems, Inc. for the year ended July 31, 1995.  These financial
statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial statements based
on our audit.

        We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatements.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.  We believe that our audit provides a reasonable
basis for our opinion.

	In our opinion, the financial statements referred to above present
fairly, in all material respects, the results of discontinued operations
and cash flows of Computer Transceiver Systems, Inc. for the year ended
July 31, 1995, in conformity with generally accepted accounting principles.



                                       S/Sax Macy Fromm & Co., P.C.
                                       Sax Macy Fromm & Co., PC
                                       Certified Public Accountants



Clifton, New Jersey
October 20, 1995

                                       F-3
<PAGE>
<TABLE>
                        Computer Transceiver Systems, Inc.
                                  Balance Sheets
<CAPTION>                                                                             
                                                  July 31, 1997                    July 31,1996
<S>                                                   <C>             <C>              <C>              <C>
    Assets
                                                                         
Current Assets:
      Marketable securities                           $      3,052                     $     3,052
                                                      -------------                    -------------
          Total Current Assets                                        $     3,052                       $     3,052
                                                                      ------------                      ------------
Total Assets                                                          $     3,052                       $     3,052
                                                                      ============                      ============

                                  Stockholders' Equity 


Stockholders' Equity:
     Common stock, par value $.001 per share;
       15,000,000 shares authorized;
       2,716,603 shares issued and 
       outstanding at July 31, 1997 and
       1996 respectively                                     2,716                           2,716
     Net unrealized loss on marketable securities           (2,348)                         (2,348)
     Capital stock in excess of par value                2,452,840                       2,452,840
     Accumulated deficit                                (2,450,156)                     (2,450,156)
                                                       ------------                     -----------
       Net Stockholders' Equity                              3,052                           3,052 

Total Stockholders' Equity:                                $ 3,052                        $  3,052
                                                       ============                     ===========

<FN>
The accompanying notes are an integral part of these financial statements.
</TABLE>
                                       F-4
<PAGE>
<TABLE>
                       Computer Transceiver Systems, Inc.

                      Statements of Discontinued Operations
<CAPTION>
                                                                                    
                                                                      Years Ended July 31


                                                               1997              1996               1995
<S>                                                       <C>               <C>                <C>
Gain on disposal of Assets and Liabilities, Net of
Operating Loss of $88,881 and Income                                                      
Taxes of  $591,400                                        $     ---         $      ---         $     707,274  
                                                          --------------     --------------      -------------
         Net Income (Loss)                                $     ---         $      ---         $     707,274
                                                          ==============    ===============    ===============

Earnings Per Share of Common Stock:
   Net gain on disposal of assets/liabilities             $     ---         $      ---         $         .24
                                                          --------------    ---------------    ---------------
               Net Income Per Share                       $     ---         $      ---         $         .24
                                                          ==============    ===============    ===============

Weighted Average Number of shares Outstanding                 2,716,603          2,716,603         2,933,296
                                                          ==============    ===============    ===============
<FN>

The accompanying notes are an integral part of these financial statements.
</TABLE>
                                       F-5
<PAGE>
<TABLE>
                        Computer Transceiver Systems, Inc.
              Statements of Changes in Stockholders Equity (Deficit)

                                    Years Ended
                            July 31, 1997, 1996 and 1995
<CAPTION>                                                                                    
                                                                                              Unrealized  
                                        Common Stock                  Capital        Retained      Loss On
                                      $.001 Par Value                in Excess       Earnings     Marketable
                                 Shares             Amount           Par Value      (Deficit)     Securities        Total
<S>                           <C>                 <C>             <C>             <C>             <C>           <C>
Balances at July 31, 1994      3,462,764              34,628         2,750,137     (3,157,430)       ---         (372,665)

Reduction in par value               ---             (31,166)          (31,166)           ---        ---              ---

Exchange of Vertex stock        (746,161)               (746)         (436,434)           ---        ---         (437,180)

Capital contributed by                
Vertex                               ---                 ---            64,971            ---        ---           64,971

Unrealized loss on marketable
   securities                        ---                 ---             ---              ---      (2,348)         (2,348)

Net income for the year ended
   July 31, 1995                     ---                 ---             ---          707,274         ---         707,274
                              ------------         ----------      -----------     -----------     ---------     ----------

Balances at July 31, 1995      2,716,603               2,716         2,409,840     (2,450,156)     (2,348)        (39,948)

Net income for the year ended
July 31, 1996                        ---                 ---               ---            ---         ---             ---

Capital contribution from             
Vertex                               ---                 ---            43,000            ---         ---          43,000
                              -------------        -----------     ------------    ------------   ----------    ---------

Balances at July 31, 1996
and 1997                       2,716,603               2,716         2,452,840     (2,450,156)     (2,348)          3,052

Net income for the year ended
July 31, 1997                        ---               ---               ---              ---         ---             ---
                                                                     
Balances at July 31, 1997      2,716,603           $   2,716      $2,452,840      $(2,450,156)    $(2,348)         $3,052
                              ============        =============   ===========     =============   ===========   ==========
<FN>
The accompanying notes are an integral part of these financial statements.
</TABLE>
                                       F-6
<PAGE>
<TABLE>
                        Computer Transceiver Systems, Inc.

                             Statements of Cash Flows

<CAPTION>                                                                                    
                                                                    Years Ended July 31
                                                                                    
                                                               1997                        1996                        1995
<S>                                                      <C>                        <C>                           <C>
Cash Flows From Operating Activities:
     Net income                                          $       ---                $         ---                 $   707,274
     Adjustments to reconcile net income 
            to net cash used in
            operating activities:
       Gain on sale of net assets                                ---                          ---                  (1,387,554)
       Unrealized loss on marketable securities                  ---                          ---                      (2,348)
       Increase in deferred taxes                                ---                          ---                      548,400
       (Increase) decrease in assets:
             Marketable securities                               ---                          ---                       (3,052)
             Net assets of discontinued operations               ---                          ---                       (4,940)
        Increase (decrease) in liabilities:
             Accrued expenses                                    ---                       (43,000)                     43,000
       Net adjustments to reconcile net income
            to net cash used in
            operating activities                                 ---                       (43,000)                   (806,494)
                                                         -------------              -----------------             ---------------
                    Net Cash Used in
                            Operating Activities                 ---                       (43,000)                    (99,220)
                                                         -------------              -----------------             ---------------

Cash Flows From Financing Activities:

       Proceeds from additional capital contribution             ---                        43,000                      64,971
                                                         --------------             -----------------             ---------------
           Net Cash Provided by Financing Activities             ---                        43,000                      64,971
                                                         --------------             -----------------             ---------------
Net Decrease in Cash                                             ---                           ---                     (34,249)

Cash at Beginning of Year                                        ---                           ---                      34,249
                                                         --------------             -----------------             ---------------

Cash at End of Year                                      $       ---                $          ---                $        ---
                                                         ==============             =================             ===============  
<FN>  

The accompanying notes are an integral part of these financial statements.
</TABLE>

                                       F-7
<PAGE>
                       Computer Transceiver Systems, Inc.
                         Notes to Financial Statements

Note 1 - Sale of Company Assets to Vertex and Future Plans:
        On August 31, 1994, pursuant to an "Asset Purchase Agreement" dated May
1, 1993 between the Company and Vertex Industries, Inc. ("Vertex"), the
Company's majority stockholder, and with the approval of the Company's direc-
tors and shareholders, the Company sold all of its assets to Vertex and Vertex
assumed the Company's liabilities.  The assets sold included inventory, equip-
ment, receivables, proprietary technology, goodwill and other intangibles. The
selling price of $1,699,580 was paid by Vertex through the offset and cancel-
lation of the Company's indebtedness to Vertex in the amount of $1,257,001,
with the balance of $442,579 being paid through the issuance of 236,042 shares
of Vertex common stock to the Company.  CTSI subsequently distributed 233,170
shares of Vertex common stock in an exchange offer for 746,161 shares of CTSI's
common stock.  The Vertex shares reflected in the balance sheet as marketable
securities as of July 31, 1996 and 1995 represent the remaining shares of 2,872
which were not distributed to the CTSI shareholders.  After completion of the
Exchange Offer, the number of issued and outstanding shares of the Company was
reduced from 3,462,764 to 2,716,603. As a result of the transaction,  Vertex's
ownership of the Company is approximately 72.5%.

        As a result of the sale of the Company's assets on August 31, 1994,
there were only 31 days of operations for the Company for the year ended July
31, 1995, in which the Company sustained an operating loss of $88,881. However,
the sale resulted in a net gain to the Company on the disposition of its 
assets, which amounted to $707,274, after provision for such loss and taxes.

	The Company's current business purpose is to seek out and obtain an
acquisition, and/or merger transaction, whereby its shareholders may benefit by
owning an interest in a viable enterprise.  Since the Company has no operations
or significant assets as a result of the sale, its potential for profits will
come solely from operations it may undertake after any acquisition or merger
transaction. The Company has not received from, or made any specific proposals
to, any possible merger or acquisition candidate  and there is no guarantee 
that such transaction will occur.  Vertex will be responsible for, and shall 
be the source of, any funds necessary for the Company to continue operating and
to comply with any regulatory requirements, taxes, and fees.  It will fund any
costs associated with pursuing merger or acquisition candidates.

	On August 29, 1994, the Company's shareholders approved an amendment
to the Company's Certificate of Incorporation, increasing the aggregate number
of shares the Company has authority to issue from 5,000,000 shares to
15,000,000 shares and changed the par value from $.01 to $.001.

Note 2 - Summary of Significant Accounting Policies:
        A.      Marketable Securities - The Company adopted Statement of Finan-
cial Accounting Standards No. 115 ("SFAS No. 115"), "Accounting for Certain
Investments in Debt and Equity Securities."  The adoption of SFAS No. 115
resulted in a decrease in stockholders' equity of $2,348.

                                      F-8
<PAGE>
At July 31, 1997 marketable equity securities have been categorized as 
available for sale and as a result are stated at fair value.  Marketable equity
securities available for current operations are classified in the balance sheet
as current assets.  Unrealized holding gains
and losses are included as a component of stockholders' equity until realized.

	B.	Earnings (Loss) Per Share of Common Stock - Earnings per share
of common stock is based upon the weighted average number of shares outstanding
during the year.  In March 1997, the Financial Accounting Standards Board 
issued Statement of Financial Accounting Standards No. 128, "Earnings per 
Share" which makes certain changes to the manner in which earnings per 
share is reported.  The Company is required to adopt this standard for 
the year ending July 31, 1998.  The adoption of this standard will 
require restatement of prior years' earnings per share. 


Note 3 - Income Taxes :

The Company has no operations therefore has no income tax liability other than 
minimum taxes due for State purposes.

<TABLE>
Note 4 - Supplemental Disclosures on Cash Flow Information:

	Cash paid during the year for:
<CAPTION>
                                                   Years Ended July 31
                                         1997             1996             1995
<S>                                <C>                 <C>            <C>
Interest                           $       --          $    --        $   3,030
                                   ============        =========      =========

State franchise income taxes       $       --          $    --        $     839
                                   ============        =========      =========
</TABLE>

                                       F-9

<PAGE>
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.      None.
                                     PART III

ITEM 10.	DIRECTORS AND EXECUTIVE OFFICERS.

The directors and officers of CTSI during the fiscal year ended July 31,
1997 were:
Name                 Age     Title

Thomas J. Tully      57      President, Chief Executive Officer and Director

James Q. Maloy       65      Chairman and Director

Allen G. Jacobson    65      Director

Ronald C. Byer       64      Secretary, Treasurer, Chief Financial 
                             Officer and Director

Thomas J. Tully has been employed by CTSI since its founding in 1968, initially
as a senior engineer.  Mr. Tully has served as Manager of Customer Engineering,
Vice President of Manufacturing/Development and Vice President of Operations.
Mr. Tully has been a CTSI director since November, 1986 and President since
July, 1987. He holds a Bachelor's Degree in Electrical Engineering.

James Q. Maloy is a co-founder of Vertex, and has been a director and chairman
of its board since the inception of Vertex in 1974.  From 1983 to 1995 Mr. 
Maloy was Vertex's President and chief executive officer.  From 1972 to 1974,
Mr. Maloy served as Executive Vice President and as Marketing and Engineering 
Manager for 0Datascan, Inc., a publicly-held company which designed and 
manufactured electromechanical equipment.  Previously, Mr. Maloy was a group 
manager for Bendix Aviation Corp. and was involved in the design and manu-
facture of electronic test equipment for the military.  Mr. Maloy holds a 
Bachelor's Degree in Electrical Engineering.  On July 31, 1995 Mr. Maloy 
stepped down as Vertex's President but remains Chairman of the Board and a 
director.

Allen G. Jacobson founded CTSI in 1968 and, from that time until the
confirmation of CTSI's reorganization plan in June, 1987, served as its
President and chief executive office and a director.  From July, 1987 until
May, 1988, Mr. Jacobson was CTSI's Vice President of Business Development,
and, from June, 1988 until January, 1989, was President of Computer
Integration Associates, Inc., a manufacturer of automated telephone response
systems.  Mr. Jacobson served as a Vice President of Citibank, first as the
executive in charge of a Citibank telecommunications subsidiary, and later as
an executive in Citibank's FITS division, from January, 1990 until February,
1993.  Since that time Mr. Jacobson has been on a disability furlough from
Citibank. He holds Bachelor's and Master's Degrees in Electrical Engineering.

Ronald C. Byer was elected Treasurer and Secretary of CTSI in February, 1993,
and has served as Vertex' Vice President of Marketing and Sales since 1979,
Treasurer since 1983, Executive Vice President since 1985 and a director since
1976.  From 1963 to 1975, Mr. Byer held various positions at Datascan, Inc.
Previously, Mr. Byer was employed by Bendix Aviation Corp.  He holds a
Bachelor's Degree in Electrical Engineering.  Mr. Byer was promoted to
President of Vertex on July 31, 1995 and CEO on January 17, 1996.
                                       6
<PAGE>
 ITEM 11.	EXECUTIVE COMPENSATION.

No executive officer of CTSI earned $100,000 or more in any of the last
three fiscal years.  Set forth below is the aggregate compensation for
services rendered in all capacities by CTSI's President during the fiscal
years ended July 31, 1997, 1996 and 1995:

                     Summary Compensation Table
    Name and					
    Principal                                Annual 
    Position         Year      Salary        Bonus 

Thomas J. Tully      1997     $  ----          --
   President and     1996     $  ----          --
   Chief Executive   1995     $ 9,159          --
   Officer	

CTSI  does not have any stock option, incentive stock option, retirement or
pension, 401K, stock appreciation or long-term incentive plan of any kind, and,
accordingly, no information on any such form of compensation is provided.

No CTSI executive has an employment agreement with the Company, and there are
no arrangements of any kind concerning compensation in the event of termination
of employment or change of control.

None of the Company's four directors, including Allen G. Jacobson, the only
director who is not also an employee of either Vertex or CTSI, receives any
compensation, and there are no pending or proposed compensation arrangements
concerning directors' services.  CTSI does not have a compensation committee.  

ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The following table sets forth certain information regarding CTSI's Common
Stock owned on October 1, 1995 by (i) each person who is known by CTSI to own
beneficially more than 5% of its outstanding Common Stock, (ii) each director
and officer, and (iii) all officers and directors as a group:

Names and Address of 
Directors, Officers and              Shares Owned(1)
5% Shareholders                      Number                 Percent

Vertex Industries, Inc.                 1,970,418            72.50
23 Carol Street
Clifton, New Jersey

All officers and directors                 48,979              1.8
as a group (2 persons)

(1) Share amounts are computed in accordance with Rule 13d-3.

ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

See discussion under "Sale of Assets to Vertex" in Item 1.
                                       7
<PAGE>
                                    PART IV

ITEM 14.	EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON
                FORM 8-K.

(a)	The following documents are filed as a part of this report:

1.	Financial Statements
   Included in Part II of the report:

   (i)      Reports of Independent Public Accountants.

   (ii)     Balance Sheets as of July 31, 1997 and July 31, 1996

   (iii)    Statements of Discontinued Operations for the years ended July 31, 
            1997, 1996 and 1995.

   (iv)     Statements of Changes in Stockholders' Equity (Deficit)  for the 
            years ended July 31, 1997, 1996 and 1995.

   (v)      Statements of Changes in Cash Flows for the years ended July 31, 
            1997, 1996 and 1995.

   (vi)     Notes to Financial Statements.

2.  Financial Statement Schedules
Schedules are omitted because they are not applicable or because the 
required information is included in the financial statements or notes 
thereto.

3.  Exhibits
The following is a description of exhibits required to be filed with this
report (item numbers are those assigned in the Exhibits Table of Item 601,
Regulation S-K): 

(2)  Asset Purchase Agreement between CTSI and Vertex dated as of May 1, 1993, 
filed as an Exhibit to the Prospectus on Form S-4, SEC File No. 33-76378.

(3) (i)  Articles of incorporation and by-laws, filed as Exhibits 3(a) and
3(b) to the Company's Registration Statement on Form S-1, No. 2-60542,
effective March 1, 1978, and hereby incorporated by reference.

   (ii)  Certificate of Amendment of Certificate of Incorporation (filed July 
13, 1987), filed with the Company's Annual Report on Form 10-K for the period 
ended July 31, 1987, hereby incorporated by reference.

 (4)  Instruments defining rights of security holders:
   (i)  Filed as Exhibits 4(a) and 4(c) and 5 to the aforesaid Registration 
Statement, and hereby incorporated by reference.

   (ii)  Debtor's First Amended Plan of Reorganization dated May 5, 1987, filed
with the Commission on or about May 15, 1987 and incorporated by reference.

   (iii)  Specimen Certificate for shares of new common stock, filed with
  Annual Report on Form 10-K for the period ended July 31, 1987, incorporated
  by reference.
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(10)  Material Contracts:

(a)	Filed as Exhibits 13(a) to the aforesaid registration Statement, as 
Exhibits (ii) and (iii) to the Company's Form 10-K Annual Report for
the fiscal year ended 2/29/80 and as Exhibits 10(b)(1) and (2) to the
Form 10- K Annual Report for the fiscal year ended 2/28/84, all hereby
incorporated by reference.

(b)

(i)	Agreement dated as of February 18, 1987 between Computer Transceiver 
        Systems, Inc. and Vertex Industries, Inc., previously filed with 
        First Amended Plan of Reorganization and incorporated by reference.

(ii)    Employment Agreement dated June 29, 1987 with Allen G. Jacobson, 
        previously filed with July 31, 1987 10-K Annual Report.

(iii) 	Restricted Stock Agreement dated June 19, 1987 with Allen G. 
        Jacobson, previously filed with July 31, 1987 10-K Annual Report.

(iv)  	Waiver and Release Agreement dated June 29, 1987 with Allen G. 
        Jacobson, previously filed with July 31, 1987 10-K Report.

(v)  	Promissory Note Issued to, and Security Agreement with, Chemical 
        Bank, each dated June 29, 1987, previously filed with July 31, 1987 
        10-K Annual Report.

(vi) 	Lease Agreement dated June 1, 1987 with Vertex Industries, Inc, 
        previously filed with July 31, 1987 10-K Annual Report.

(vii) 	Agreement dated May 20, 1988 with Allen G. Jacobson, filed 
        with 10-K Annual Report for year ended July 31, 1988.

(viii)	Settlement Agreement dated December 16, 1991 among the 
        Company, Vertex Industries, Inc. and Chemical Bank, together with an 
        ancillary letter agreement of the same date between the Company and 
        Vertex, filed with 10-K Annual Report for year ended July 31, 1992.

(11) through (28) Not applicable.

 (b)  Reports on Form 8-K

	No reports on Form 8-K were filed during the fiscal year ended July
        31, 1997.

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                                  SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

   (Registrant)	 COMPUTER TRANSCEIVER SYSTEMS, INC.


   BY :                          s/Thomas J. Tully                         
                                 THOMAS J. TULLY President and Chief
                                 Executive Officer

Dated:  October  20, 1997


Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.


                                 BY        s/Thomas J. Tully               
                                           THOMAS J. TULLY
                                           Chief Executive Officer,
                                           President, Director
Date: October  20, 1997


                                 BY       s/James Q Maloy
                                          JAMES Q. MALOY, Director
Date:  October 20, 1997

                       
                                 BY ___________________________________
                                          ALLEN G. JACOBSON, Director
Date: October   20 , 1997


                                 BY       s/Ronald C. Byer               
                                          RONALD C. BYER,
                                          Treasurer, Chief Financial Officer,
                                          Secretary and Director
Date: October  20  , 1997 

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