PART I
Item 1.  Business.
------------------
     Certron Corporation is referred to herein as the "Company" or "Certron"
and such reference includes both the corporation and its subsidiary unless
otherwise indicated.  Certron was incorporated under the laws of the State of
California in 1966.

     Certron's business consists primarily of the design, development and
distribution of magnetic media products and the contract assembly and
manufacturing of products for the proprietary to others.

     The following table sets forth, for the years ended October 31, 1996,
1995, and 1994, the amounts of net sales and operating profit before general
corporate expense and interest expense, together with identifiable assets at
October 31, 1996, 1995 and 1994 attributable to each of the Company's industry
segments.
<TABLE>
<CAPTION>
                                            Year ended October 31,
                                       ------------------------------    
                                        1996        1995        1994 
                                       ------      ------      ------
                                               (In Thousands)
Net sales to unaffiliated customers:
    <S>                                <C>         <C>         <C>
    Magnetic Media products            $5,382      $3,895      $4,182
    Contract Assembly                  $  -        $    5      $3,769         

Operating profit:
    Magnetic Media products            $  911      $  365      $  377
    Contract Assembly                     -           -        $  404

Identifiable assets:
    Magnetic Media products            $2,652      $1,638      $2,387
    Contract Assembly                     -           -        $  340
</TABLE>
Magnetic Media Products
-----------------------

    The Company's magnetic media products consist primarily of blank audio and
video cassettes and floppy disks.  The Company also distributes magnetic media
accessories for computers.  All video tape and most audio tape and related
plastics are presently being procured by the Company primarily from offshore
sources.  During the fiscal years ended October 31, 1996, 1995 and 1994, net
sales of the Company's magnetic media products were as follows:
<TABLE>
<CAPTION>
                                                  Net Sales
                                        -----------------------------          
           Product                      1996        1995        1994 
------------------------------------   ------      ------      ------
<S>                                    <C>         <C>         <C>
Audio magnetic tape products           $4,148      $2,908      $3,037
Other magnetic related items (floppy)      22          67         120
Video cassettes                         1,212         920       1,025
                                       ------      ------      ------
                                       $5,382      $3,895      $4,182
</TABLE>
                                     1
     Certron sells blank audio magnetic tapes in several cassette
configurations of various sizes and playing times, and distributes VHS and 8mm
video cassettes.  The Company purchases substantially all of its requirements
for audio and video cassettes from sources both in the Far East and Mexico. 
Some audio cassette assembly and packaging (primarily of micro and mini
cassettes) by the Company takes place at the facility operated by Certron in
Mexicali, B.C., Mexico (where some slitting also occurs).

     Certron's magnetic media products are marketed and sold primarily in the
United States to wholesale distributors, original equipment manufacturers,
mail order companies and major retail outlets.  Less than 5% of the Company's
net sales during the last three fiscal years were to foreign customers.  The
Company's products are distributed under its own labels and under different
customer labels.  Standard sized and miniaturized cassettes for dictation
purposes and cassettes for telephone answering devices are also sold to office
supply outlets and distributors.

     For the fiscal year ended October 31, 1996, the Company's ten largest
customers of magnetic media products accounted in the aggregate for
approximately 82% of the Company's total net sales of such magnetic media
products.  During fiscal 1996, the two largest single magnetic media customers
accounted for $1,184,420 and $1,065,053 or 22% and 20% of total magnetic media
sales, respectively.  In the fourth quarter of fiscal 1996, the magnetic media
customer which accounted for $1,184,420 of magnetic sales in fiscal 1996
informed the Company that following delivery of products ordered for early
February 1997, such customer would no longer use Certron as its major supplier
for certain of its private-label audio products.  Although sales to this
customer should materially decrease beginning in the second quarter of fiscal
1997, the Company does not expect the substantial reduction in this customer's
business in fiscal 1997 to materially reduce the Company's magnetic media
sales in fiscal 1997 as compared to fiscal 1996 magnetic media sales.  See
"Item 7.  Management's Discussion and Analysis of Financial Condition and
Results of Operations - Results of Operations". 

     The Company believes that the amount of its backlog on any given date is
not necessarily indicative of trends in its magnetic media business as much as
orders received for such products are generally completed in less than 60
days.

     Most of the Company's magnetic media products are available from multiple
sources, although certain components utilized in the manufacture of the
Company's magnetic media products are available from a few sources.  The
Company has no reason to anticipate that it will be unable to purchase
components from those sources.



Contract Assembly
-----------------

     The Company assembles products for others.  Sales from contract assembly
result from contracts negotiated directly with the customer.  The products are
designed by the customer and assembled by the Company in accordance with
customer specifications.  The customer supplies the raw materials.  The
Company's responsibility and sales are limited to the assembly service.  All
of the assembly occurs in the Company's facilities in Mexicali, B.C., Mexico. 
The Company did not have any meaningful sales in the contract assembly segment
of its business in fiscal 1995 and 1996.

                                     2
     During the fiscal year ending October 31, 1994, approximately 72% of the
Company's Mexicali sales in this segment were to Papermate, a division of
Gillette.  Sales to Spectrol Electronics Corporation accounted for the
majority of the remaining balance of sales in this segment in 1994.  The
contract with Gillette expired October 31, 1994.  The contract with Spectrol
expired August 31, 1994.  Spectrol and Gillette did not renew their contracts. 
The Company has been actively seeking, without success, other firms to replace
the Spectrol and Gillette business.



Competition
-----------

     In all areas of Certron's magnetic media business, competition is now,
and is expected to continue to be, active and intense.  There are many
substantial competitors with larger resources than Certron in each market for
its magnetic media products.  The Company believes that it occupies a small
portion of the total market for its magnetic media products.  The principal
methods of competition in the magnetic media market involve price, quality and 
advertisement, with the promotional priced audio tape products, floppy disk
and video cassettes being the most price sensitive.  Since the Company has not
spent substantial amounts in consumer advertising of its high performance
blank tape products, and video cassettes, it has been at a competitive
disadvantage in these areas and has had to charge  a lower per unit price than
some competitors selling comparable products having strong brand recognition. 
The Company has experienced extensive  price competition from Far East
manufacturers and distributors of low-cost audio  cassettes and from other
manufacturers and distributors for sales of floppy disks and video cassettes,
which has made it difficult for the Company to maintain prices.  See "Item 7. 
Management's Discussion and Analysis of Financial Condition and Results of
Operations - Liquidity and Capital Resources."  Although the possibility of
technical obsolescence of present magnetic media products sold by the Company
exists, the Company is not aware of any development, either in hardware or
media, which presently threaten to supersede the general use now being made of
these types of magnetic media products.


Employees
---------

At January 1, 1997, Certron employed 73 people in its various operations,
consisting of 60 people at its operations in Mexicali, B.C., Mexico, 4 people
at its facility in Corona, California and 9 people at its facility in Los
Angeles, California.  











                                     3



Item 2.  Properties.
--------------------

The principal office, assembling and warehousing facilities of the Company are
as follows:
<TABLE>
<CAPTION>
                  Approx. Area                     Approx.                
Location            Sq. ft.    Lease Expires     annual rent   Principal use 
-----------------------------------------------------------------------------

<C> <S>               <C>        <C>             <C>          <S>
422 N. Smith Avenue   15,970     8-31-98(1)      $ 73,000     Warehouse and
Corona, CA                                                    packaging

1600 South Broadway    3,196     8-31-98(1)      $ 15,000     Warehouse and
Los Angeles, CA                                               sign on top of
                                                              building

1545 Sawtelle Blvd.    2,176     2-28-96(1)      $ 55,000     Administration
Los Angeles, CA

Calle Venus # 90
Parque Industrial     15,000     2-28-97         $56,000      Magnetic Media
Mexicali, B.C., Mexico                                        assembly &
                                                              packaging
                                                              and contract
                                                              assembly &
                                                              manufacturing
</TABLE>
----------------------------------------------

(1) 422 N. Smith Avenue, 1600 South Broadway and 1545 Sawtelle Blvd. are
leased from Louart  Corporation, a principal stockholder of Certron.  The 1600
South Broadway is subleased by Certron for $1,200 a month.

The Company believes that its facilities are satisfactorily maintained in
satisfactory operating condition and are adequate for its needs.



Item 3.  Legal Proceedings.
---------------------------

     There are some pending legal proceedings to which the Company is a party,
none of which the Company believes are material. 



Item 4.  Submission of Matters to a Vote of Security Holders.
-------------------------------------------------------------

     No matter was submitted during the fourth quarter of the fiscal year
covered by this report to a vote of security holders, through the solicitation
of proxies or otherwise.


                                     4


                                  PART II



Item 5.  Market for Registrant's Common Equity and Related Stockholder
         Matters.
-----------------------------------------------------------------------

     Certron's Common Stock is traded in the Over-the-Counter market.  The
following table shows the high and low bid quotations for such stock in the
Over-the-Counter market for each fiscal quarter during the two fiscal years
ended October 31, 1996.  These quotations reflect inter-dealer prices, without
retail mark-up, mark-down or commission, and may not necessarily represent
actual transactions.
<TABLE>
<CAPTION>

     Fiscal period             High         Low
     -------------             ----         ---

     1995
     ----
     <S>                      <C>           <C>
     First quarter            1-1/8         3/4
     Second quarter           1-1/8       13/16
     Third quarter           1-1/16         1/2
     Fourth quarter               1         5/8

     1996
     ----
     First quarter            15/16         5/8
     Second quarter             7/8         5/8                        
     Third quarter           1-3/16       11/16
     Fourth quarter           15/16         5/8
</TABLE>


     As of January 10, 1997, the approximate number of holders of record of
the Company's Common Stock was 1,499.  The Company has never paid a cash
dividend on ts Common Stock. 




















Item 6.  Selected Financial Data.
---------------------------------
<TABLE>
<CAPTION>

                    1996         1995        1994        1993         1992
                 ------------------------------------------------------------
<S>              <C>          <C>         <C>        <C>          <C>
Net Sales        $5,382,000   $3,900,000  $7,951,000 $10,568,000  $16,778,000
Net income 
 (loss)  before
  extraordinary
  credit              28,000 ($ 774,000) ($ 170,000)($    47,000) $    53,000
Net income (loss)     28,000 ($ 774,000) ($ 170,000)($    47,000) $    87,000
Net income (loss) 
  before extra-
  ordinary credit
  per share           .01        ($.25)     ($.05)      ($.02)       $.02  
Net income (loss) 
  per common 
  share               .01        ($.25)     ($.05)      ($.02)       $.03  
Total assets      $4,062,000  $3,965,000  $4,710,000 $ 5,054,000  $ 5,197,000  
Long-term debt          -            -          -           -            -
Working capital   $2,791,000  $2,844,000  $3,412,000 $ 3,772,000  $ 4,080,000  
Stockholders' 
   equity         $3,355,000  $3,368,000  $4,027,000 $ 4,284,000  $ 4,331,000  
</TABLE>

     No cash dividends have been paid during the five-year period ended
October 31, 1996.


                                     5



























Item 7.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations.
------------------------------------------------------------------------

Liquidity and Capital Resources
-------------------------------

     As demonstrated by the following chart, the Company's working capital and
cash flow from operations decreased at October 31, 1996 as compared to that at
October 31, 1995.  The decrease in cash flow from operations was primarily the
result of increased sales.  Accounts receivable increased by $146,000,
inventories increased by $738,000, cash decreased by $882,000 and other assets
increased by $55,000.  Accounts payable and accrued expenses increased by
$110,000.
<TABLE>
<CAPTION>
                                                October 31
                                   ------------------------------------        
                                      1996         1995         1994   
                                   ----------   ----------   ----------
 
    <S>                            <C>          <C>          <C>
    Working Capital                $2,791,000   $2,844,000   $3,412,000     
    Current Ratio                   4.95 to 1    5.76 to 1    6.00 to 1     
    Cash Flows from Operations    ($  750,000)  $  124,000   $  185,000        
</TABLE>
 

     The Company's liquidity has been supplied by internally generated funds
and, prior to 1995, short-term borrowing.  The Company elected not to renew
its bank line of credit which expired on March 31, 1995.  The Company
concluded not to incur the cost and expenses of extending and maintaining the
bank line of credit until such time as bank borrowings were required.  The
Company believes that it will be able to fund its existing business out of
current cash flow without the necessity of bank borrowings At October 31,
1996, the Company had no material commitments for capital expenditures.

     The intense competition in the magnetic media field has made it difficult
for the Company to maintain prices on its magnetic media products and has
continually reduced the Company's margins on these products.  As a result, the
Company has discontinued sales of certain magnetic media products and refused
to sell magnetic media products at prices not resulting in certain minimum
margin returns. The Company does not believe that price competition in the
magnetic media field will lessen in the foreseeable future and, therefore,
there may not presently be meaningful opportunities for it to substantially
increase its sales and operating profit through its traditional outlets.  As
described below, the Company is attempting to become a private label
manufacturer of magnetic media products for several large national and
international companies and has had some success in obtaining orders which
resulted in increased fiscal 1996 sales.

     The Company is  actively investigating acquiring other product lines or
businesses.  If any of these investigations result in an acquisition of assets
or a business, the Company believes that, due to its existing financial
condition, it can obtain any necessary cash financing for such acquisition
from bank borrowings.  There can be no assurance, however, that the Company
can find such an acquisition.

                                     6

Results of Operations
----------------------
     Fiscal 1996 Compared to Fiscal 1995
     -----------------------------------
     During fiscal 1996, the Company had a net income of $28,000 on sales of
$5,382,000 as compared to a net loss of $774,000 for fiscal 1995 on sales of
$3,900,000.  Gross profit increased by $532,000 between fiscal 1996 and fiscal
1995.  Selling, general and administrative expenses increased by $6000,
depreciation and amortization expense decreased by $4,000 and interest income
decreased by $69,000. 
     Sales of magnetic media products were $5,382,000 in fiscal 1996 as
compared to $3,895,000 in fiscal 1995.  The increase of 38% was primarily the
result of sales to two major private label users of magnetic media products. 
In the fourth quarter of fiscal 1996,  the Company was informed by one of
those private label customers that following delivery of products  ordered for
early February 1997, such Customer would no longer use Certron as a major
resource for certain of its private label audio products which accounted for
approximately $978,500 of the Company's net sales for the fiscal year ended
October 31, 1996.  This customer assured the Company that its decision was not
due to price, quality or delivery.  In addition, the customer indicated that
it will continue to purchase other private label audio products from the
Company.  At the same time, another private label customer has projected
increased purchases beginning December 1996. Although no assurances can be
given and the Company anticipates that sales will decline beginning in the
second quarter of fiscal 1997, based upon those indications and continued
(although substantially reduced) purchases by the customer which has informed
the Company that the Company would no longer be a major source for certain of
that customer's private label magnetic media products, the Company does not
believe that the Company's fiscal 1997 magnetic media sales will be materially
reduced when compared to fiscal 1996 magnetic media sales.
     An investment in Stuart's Department Store, a discount department store
operation located in New England, was written off during the third quarter of
fiscal year 1995 resulting in a charge to operations in the amount of
$341,000.  Stuart's filed for bankruptcy under the Federal Bankruptcy Code in
April of 1995 and management has concluded that the chances of recovery from
the Stuart's bankruptcy are highly doubtful.
     Total gross margin as a percentage of net sales was 26.8% in fiscal 1996
and 23.4% in fiscal 1995.  This change was due to increased sales of audio
magnetic media products.  Margins increased by $532,000 (58.3%) in fiscal
1996. Margins in fiscal 1996 were $1,445,000 and in fiscal 1995 were $913,000.
     Selling, general and administrative expense increased by $6,000 during
fiscal 1996 from $1,468,000 in 1995 to $1,474,000 in 1996.  The increase was
due to an increase of personnel expense by $31,000, advertising by $34,000,and
offset by a decreased of commission by $24,000, insurance by $21,000 and other
expenses by $26,000. 
     Interest income decreased by $69,000 in fiscal 1996 due to the decrease
in cash and cash equivalents.  Interest income in fiscal 1995 was $178,000
compared to $109,000 in fiscal year 1996.
     During fiscal 1996, the Company invested cash, not needed in operations,
in publicly traded common stocks of other companies, and may purchase
additional common stocks in the future.  Investments in common stocks are
subject to risks of the market, and market prices may fluctuate and be
adversely affected by the operating results of the issuer, as well as general
economic, political and market conditions.  As of October 31, 1996, the
Company held common stocks which had a cost of approximately $114,000 and
market value of approximately $101,000. 
                                     7



In accordance with Generally Accepted Accounting Principles, the Company has
recorded the value of its investments in marketable securities on its Balance 
Sheet to market value and this decrease of approximately $13,000 is reflected
in stockholders' equity as an unrealized holding loss (see Notes 1 and 3 of
Notes to Consolidated Financial Statements).  If the Company sells these
securities, the Company will recognize a loss in its statement of operations
equal to the amount of the decrease.  Although the Company presently intends
to hold these securities, if, on account of its capital requirements or for
any other reason, the Company should decide to liquidate these or other
investments at a time when their market value is less than their cost, the
Company would recognize a loss which could adversely affect the results of
operations for the period in which the sale occurs.
     Fiscal 1995 Compared to Fiscal 1994
     -----------------------------------
     During fiscal 1995, the Company had a net loss of $774,000 on sales of
$3,900,000  as compared to a net loss of $170,000 for fiscal 1994 on sales of
$7,951,000.  Gross profit decreased by $774,000 between fiscal 1995 and fiscal
1994.  Selling, general and administrative expenses decreased by $383,000,
depreciation and amortization expense decreased by $47,000 and interest income
increased by $81,000. 

     Sales of magnetic media products were $3,895,000 in fiscal 1995 as
compared to $4,182,000 in fiscal 1994.  The decrease of 7% was the result of
lower prices on product, general business conditions and the Company's
decision not to sell magnetic media products not resulting in certain minimum
margin return.  In order to reverse the sales slide, the Company has made
every effort to become a private label manufacturer of magnetic media products
for several large national and international companies by emphasizing the
Company's consistency in quality and manufacturing expertise. See "Liquidity
and Capital Resources".

     Sales of contract assembly and manufacturing services decreased by
$3,764,000 (99.8%) during fiscal 1995 as compared to fiscal 1994.  Fiscal 1995
sales were $5,000 and fiscal 1994 sales were $3,769,000.  During the fiscal
year ended October 31, 1994, substantially all of the sales in this segment
were to two customers whose contracts expired in the latter portion of the
year and were not renewed.  The Company  is actively seeking new customers to
replace this lost business.

     An investment in Stuart's Department Store, a discount department store
operation located in New England, was written off during the third quarter of
fiscal year 1995 resulting in a charge to operations in the amount of
$341,000.  Stuart's filed for bankruptcy under the Federal Bankruptcy Code in
April of 1995 and management has concluded that the chances of recovery from
the Stuart's bankruptcy are highly doubtful.

     Total gross margin as a percentage of net sales was 23.4% in fiscal 1995
and 21.2% in fiscal 1994.  This change was due to decreased personnel and
warehouse expense.  Margins decreased by $774,000 (45.9%) in fiscal 1995. 
Margins in fiscal 1995 were $913,000 and in fiscal 1994 were $1,687,000.

     Selling, general and administrative expense decreased by $383,000 during
fiscal 1995 from $1,851,000 in 1994 to $1,468,000 in 1995.  The decrease was
due to a reduction in commissions by $82,000, freight by $167,000, office
supplies by $37,000, advertising by $19,000 and other expenses by $78,000.

     Interest income increased by $81,000  in fiscal 1995 due to the increase
in cash and cash equivalents.  Interest income in fiscal 1994 was $97,000
compared to $178,000 in fiscal year 1995.
                                     8

    During fiscal 1995, the Company invested cash, not needed in operations,
in publicly traded common stocks of other companies, and may purchase
additional common stocks in the future.  Investments in common stocks are
subject to risks of the market, and market prices may fluctuate and be
adversely affected by the operating results of the issuer, as well as general
economic, political and market conditions.  As of October 31, 1995, the
Company held common stocks which had a cost of approximately $87,000 and
market value of approximately $115,000.  In accordance with Generally Accepted
Accounting Principles, the Company has recorded the value of its investments
in marketable securities on its Balance Sheet to market value and this
increase of approximately $28,000 is reflected in stockholder's equity as an
unrealized holding gain (see Notes 1 and 3 of Notes to Consolidated Financial
Statements).  If the Company sells these securities, the Company will
recognize a gain in its statement of operations equal to the amount of the
increase.  Although the Company presently intends to hold these securities,
if, on account of its capital requirements or for any other reason, the
Company should decide to liquidate these or other investments at a time when
their market value is less than their cost, the Company would recognize a loss
which could adversely affect the results of operations for the period in which
the sale occurs.

    

     Forward-Looking Statements
     --------------------------    

     The Company's statements herein which are not historical facts, including
statements as to the Company's anticipation that sales will decline beginning
in the second quarter of the 1997 fiscal year and the Company's belief that
magnetic media sales in fiscal 1997 will not be materially reduced when
compared to fiscal 1996 magnetic media sales, are forward-looking statements. 
These statements involve risks and uncertainties that could cause actual
results to differ materially from these forward-looking statements.  Factors
which could cause actual results to differ materially include economic
conditions, the Company's success in maintaining its current customer base
including sales of other products to the customer which has informed the
company that it would no longer be using the company as a major resource for
certain products, the obtaining of increased orders from a private label
customer  consistent with its indications, the Company's ability to obtain
additional customers and business, pricing factors and competition.
















                                     9



Item 8. Financial Statements and Supplementary Data.
----------------------------------------------------


         [Letterhead of Singer Lewak Greenbaum & Goldstein LLP]



           Report of Independent Certified Public Accountants
           --------------------------------------------------


Board of Directors
Certron Corporation

We have audited the accompanying consolidated balance sheets of Certron
Corporation and Subsidiary as of October 31, 1996 and 1995, and the related
consolidated statements of operations, stockholders' equity, and cash flows
for each of the three years in the period October 31, 1996.  We have also
audited Schedule II of Certron Corporation and Subsidiary for the three years
ended October 31, 1996.  These financial statements and financial statement
schedule are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial statements and
financial statement schedule 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 misstatement.  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 consolidated financial position of Certron
Corporation and Subsidiary as of October 31, 1996 and 1995, and the
consolidated results of their operations and cash flows for each of the three
years in the period October 31, 1996, in conformity with generally accepted
accounting principles.  In addition, in our opinion, the financial statement
schedule referred to above, when considered in relation to the basic financial
statements taken as a whole, present fairly, in all material respects, the
information required to be included therein.




SINGER LEWAK GREENBAUM & GOLDSTEIN LLP

Los Angeles, California
December 17, 1996





                                    10


<TABLE>
<CAPTION>
                      CERTRON CORPORATION AND SUBSIDIARY
                      ----------------------------------
                         CONSOLIDATED BALANCE SHEETS
                         ---------------------------
                                                          October 31,
                                                   -------------------------   
  ASSETS                                              1996           1995   
----------                                         ----------     ----------
CURRENT ASSETS:
 <S>                                              <C>            <C>
 Cash and cash equivalents (Note 10)               $  910,000     $1,792,000  
 Trade accounts receivable, less allowance 
 for doubtful accounts of $40,000 in 1996 
 and 1995 (Note 8)                                    527,000        381,000  
 Inventories:
    Finished products                               1,390,000        822,000  
    Work in process                                    14,000          9,000  
    Raw materials                                     464,000        299,000 
                                                   ----------     ----------   
        Total inventories                           1,868,000      1,130,000  
 Other current assets                                 193,000        138,000
                                                   ----------     ----------  
        Total current assets                        3,498,000      3,441,000
                                                   ----------     ----------  

NOTE RECEIVABLE (Note 2)                              250,000        250,000  
                                                   ----------     ----------
EQUIPMENT AND LEASEHOLD IMPROVEMENTS, AT COST:
 Machinery and equipment                              314,000        243,000  
 Dies and molds                                       233,000        203,000  
 Furnitures, fixtures and leasehold improvements      222,000        218,000
                                                   ----------     ----------  
                                                      769,000        664,000  
    Less accumulated depreciation 
        and amortization                          (   588,000)   (   537,000) 
                                                   ----------     ----------
        Net Equipment and Leasehold Improvements      181,000        127,000  
                                                   ----------     ----------
MARKETABLE SECURITIES (Note 3)                        101,000        115,000   
         
OTHER ASSETS                                           32,000         32,000   
                                                   ----------     ----------
                                                   $4,062,000     $3,965,000  
                                                   ==========     ==========














 LIABILITIES AND STOCKHOLDERS' EQUITY
-------------------------------------
CURRENT LIABILITIES:
 Accounts payable                                  $   17,000           - 
 Accrued advertising                                  314,000     $  236,000  
 Accrued professional fees                             66,000         66,000  
 Accrued payroll and related items                    171,000        173,000  
 Other accrued expenses                               139,000        122,000
                                                   ----------     ----------  
    Total current liabilities                         707,000        597,000  
                                                   ----------     ----------
COMMITMENTS (Notes 7)

STOCKHOLDERS' EQUITY (Note 5):
 Common stock, no par value; stated value 
 $1 per share; authorized 10,000,000 shares; 
 issued and outstanding, 3,128,000 shares 
 (1996 and 1995)                                    3,128,000      3,128,000  
 Additional paid-in capital                         1,824,000      1,824,000  
 Net unrealized (loss) gain on marketable 
 equity securities (Note 3)                       (    13,000)        28,000  
 Accumulated deficit                              ( 1,584,000)   ( 1,612,000) 
                                                   ----------     ----------
      Total Stockholders' Equity                    3,355,000      3,368,000  
                                                   ----------     ----------
                                                   $4,062,000     $3,965,000  
                                                   ==========     ==========
</TABLE>
              See notes to consolidated financial statements.
                                    11






























<TABLE>
<CAPTION>
                      CERTRON CORPORATION AND SUBSIDIARY
                      ---------------------------------- 
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                    --------------------------------------

                                               Year Ended October 31,
                                       --------------------------------------  
                                          1996          1995          1994
                                       ----------    ----------    ----------
 
<S>                                   <C>           <C>           <C>
NET SALES (Note 8)                     $5,382,000    $3,900,000    $7,951,000 

COSTS AND EXPENSES:
   Cost of products sold                3,937,000     2,987,000     6,264,000
   Selling, general and 
   administrative (Note 9)              1,474,000     1,468,000     1,851,000
   Depreciation and amortization           51,000        55,000       102,000
                                       ----------    ----------     ---------  

                                        5,462,000     4,510,000     8,217,000  
   
LOSS FROM OPERATIONS                  (    80,000)  (   610,000)  (   266,000) 
  

OTHER INCOME (EXPENSE)
   Loss on write down of marketable          
     equity securities                       -      (   341,000)         -  
   Interest income                        109,000       178,000       97,000
                                       ----------    ----------   ----------   
   

INCOME (LOSS) BEFORE PROVISION 
   FOR TAXES                               29,000   (   773,000)  (  169,000)

PROVISIONS FOR TAXES (Note 6)               1,000         1,000        1,000   
                                       ----------    ----------    ---------

NET INCOME (LOSS)                      $   28,000   ($  774,000)  ($ 170,000)
                                       ==========    ==========    =========

Net income (loss) per share               $.01         ($.25)       ($.05)     
                                          ====          ====         ====
Weighted average common shares 
   outstanding                          3,128,000     3,128,000    3,128,000   
                                       ==========    ==========   ========== 
</TABLE>



              See notes to consolidated financial statements.



                                    12



<TABLE>
<CAPTION>
                     CERTRON CORPORATION AND SUBSIDIARY
                     ----------------------------------  
              CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
              ----------------------------------------------- 
                                               Net   
                                            Unrealized
                                           (Loss) Gain
                                               on           
                Common Stock     Additional Marketable
            --------------------  paid-in     Equity   Accumulated
             Shares     Amount    capital   Securities   deficit     Total  
            --------- ---------- ---------- ----------  ---------  ----------
BALANCE, 
 October 31,
<S>        <C>       <C>        <C>        <C>         <C>         <C>
   1993     3,128,000 $3,128,000 $1,824,000            ($ 668,000) $4,284,000 

 Unrealized 
 Loss on 
 Marketable
 Securities                                 ($ 87,000)            (    87,000) 
 Net Loss                                             (   170,000)(   170,000)
            --------- ---------- ----------  --------  ----------  ----------  
BALANCE, 
 October 31,
  1994      3,128,000  3,128,000  1,824,000 (  87,000)(  838,000)   4,027,000 

 Unrealized 
 Gain on 
 Marketable
 Securities                                   115,000                 115,000 
   
 Net Loss                                             (  774,000) (   774,000)
            --------- ---------- ----------  --------  ---------   ----------
BALANCE, 
 October 31,
   1995     3,128,000  3,128,000  1,824,000    28,000 (1,612,000)   3,368,000 

 Unrealized 
 Loss on 
 Marketable
 Equity 
 Securities                                 (  41,000)            (    41,000)
 
 Net (Loss) 
 Income                                                   28,000       28,000 
            --------- ---------- ----------  --------- ---------   ----------
BALANCE, 
 October 31,
   1996     3,128,000 $3,128,000 $1,824,000 ($ 13,000)($1,584,000)  3,355,000
            ========= ========== ==========  ========  ==========  ==========
</TABLE>
             See notes to consolidated financial statements.

                                    13



<TABLE>
<CAPTION>

                      CERTRON CORPORATION AND SUBSIDIARY
                      ----------------------------------
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                    -------------------------------------

                                                 Year Ended October 31,        
                                          -----------------------------------  
                                              1996        1995         1994   
                                          ----------  ----------   ----------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                      <C>         <C>          <C> 
Net income (loss)                         $   28,000 ($  774,000) ($  170,000) 
                                          ----------  ----------   ----------
Adjustments to reconcile net income 
 (loss) to net cash (used in) 
 provided by operating activities:
 Depreciation and amortization                51,000      55,000      102,000  
 Loss on write down marketable 
  equity securities                             -        341,000         -     
 Changes in operating assets and 
  liabilities:
 (Increase) decrease in trade 
   accounts receivable                   (   146,000)    486,000      250,000  
 (Increase) decrease in inventories      (   738,000)     73,000      134,000  
 (Increase) decrease in other assets     (    55,000)     29,000  (    44,000) 
 Increase (decrease) in accounts payable      17,000 (    16,000) (    20,000) 
 Increase (decrease) in accrued 
   expenses                                   93,000 (    70,000) (    67,000) 
                                          ----------  ----------   ----------

Total adjustments                        (   778,000)    898,000      355,000 
                                          ----------  ----------   ----------
 Net cash (used in) provided by  
   operating activities                  (   750,000)    124,000      185,000 
                                          ----------  ----------   ----------


CASH FLOWS FROM INVESTING ACTIVITIES:
 Expenditures for equipment and 
   leasehold improvements                (   105,000)(    57,000) (    11,000) 
 Proceeds from sale of marketable 
   securities & equipment                     82,000      91,000       10,000  
 Purchase of marketable securities       (   109,000)(   226,000) (   284,000) 
                                          ----------  ----------   ----------
 Net cash used in investing activities   (   132,000)(   192,000) (   285,000) 
                                          ----------  ----------   ----------  










CASH FLOWS FROM FINANCING ACTIVITIES:
 Borrowings on line of credit                   -        460,000         -     
 Payments of line of credit                     -    (   460,000)        -     
                                          ----------  ----------   ----------
 Net cash used in financing activities          -           -            -     
                                          ----------  ----------   ----------


NET DECREASE IN CASH 
 AND CASH EQUIVALENTS                    (   882,000)(    68,000) (   100,000) 


CASH AND CASH EQUIVALENTS, 
 beginning of year                         1,792,000   1,860,000    1,960,000 
                                          ----------  ----------   ----------
CASH AND CASH EQUIVALENTS, 
 end of year                              $  910,000  $1,792,000   $1,860,000 
                                          ==========  ==========   ==========


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION -

 Cash paid during the year for:
 Interest                                 $   13,000  $   14,000   $   13,000 
 Income taxes                             $    1,000  $    1,000   $    1,000 

</TABLE>


              See notes to consolidated financial statements.


                                    14



























                     CERTRON CORPORATION AND SUBSIDIARY
                     ----------------------------------
                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               YEARS ENDED OCTOBER 31, 1996, 1995 AND 1994
               -------------------------------------------

Note 1 - Summary of Significant Accounting Policies
---------------------------------------------------
 Principles of Consolidation
 ---------------------------
 The consolidated financial statements include the  accounts of Certron
 Corporation and its wholly owned subsidiary, Certron Audio, S.A.   
 (collectively the "Company").  All material intercompany profits,
 transactions and balances have been eliminated.
 Translation of Foreign Currencies
 ---------------------------------
 All balance sheet accounts of foreign operations are translated into U.S.
 dollars at the year-end rate of exchange, and statement of operations
 items are translated at the weighted average exchange rates for the year. 
 Since  foreign activities are considered to be an extension of the U.S. 
 operations, the gain or loss resulting from remeasuring these
 transactions into U.S. dollars are included in operations.
 Cash and Cash Equivalents
 -------------------------
 For purposes of these financial statements, the Company considers all
 cash on hand and on deposit, and securities with original purchased
 maturities of less than three months to be cash and cash equivalents.
 Inventories
 -----------
 Inventories are stated at the lower of cost (first-in, first-out method)
 or market.
 Equipment and Leasehold Improvements
 ------------------------------------
 Equipment and leasehold improvements are stated at cost and are
 depreciated or amortized using the straight-line method over the lesser
 of the estimated useful lives of the assets or the applicable lease
 terms.
 Marketable Equity Securities
 ----------------------------
 The Company adopted Statement of Financial Accounting Standards No. 115,
 "Accounting for Certain Investments in Debt and Equity Securities" (FAS
 115), for the year ended October 31, 1994.  In accordance with FAS 115,
 prior years' financial statements were not restated to reflect the change
 in accounting method.  There was no cumulative effect as a result of
 adopting FAS 115 in  1994.

 Management determines the appropriate classification of its investments
 in debt and equity securities at the time of purchase and reevaluates
 such determination at each balance sheet date. Securities available for
 sale are carried at fair value, with the unrealized gains and losses, net
 of tax, reported in a separate component of stockholders' equity.  At
 October 31, 1996, the Company had no investments that qualified as
 trading or held to maturity.

 Marketable equity securities are valued based on quoted market prices. 
 The cost of securities sold is determined by the "identified cost"
 method.

                                    15

 Taxes on Income 
 ---------------
 The Company files tax returns excluding its subsidiary for federal tax
 purposes and combined returns with its subsidiary for state purposes.

 For the year ended October 31, 1994, the Company adopted the liability method
 of accounting for income taxes pursuant to Statement of Financial Accounting
 Standard, No. 109, "Accounting for Income Taxes", (FAS 109).  The Company
 previously used the deferred method.  The accumulated effect of the change in
 accounting principle on the Company's October 31, 1994 financial statement
 was insignificant and, accordingly, has been given no accounting recognition
 in the statement of operations.

 FAS 109 requires an asset and liability approach that recognizes current and
 deferred taxes payable or refundable as a result of all events that have been
 recognized in the financial statements or income tax returns as measured by
 the provisions of enacted tax laws.

 Income (Loss) Per Common Share
 ------------------------------
 Income (loss) per common share is based on the weighted average number of
 common shares outstanding during the year and the effect of common stock
 equivalents, if dilutive.

 Estimates
 ---------
 In preparing consolidated financial statements in conformity with generally
 accepted accounting principles, management makes estimates and assumptions
 that affect the amounts of assets and liabilities and disclosures of
 contingent assets and liabilities at the date of the consolidated financial
 statements, as well as the reported amounts of revenues and expenses during
 the reporting period.  Actual results could differ from those estimates.

 Fair Value of Financial Instruments
 -----------------------------------
 The Company measures its financial assets and liabilities in accordance with
 generally accepted accounting principles.  For certain of the Company's
 financial instruments, including cash and cash equivalents, accounts
 receivable, notes receivable, accounts payable and accrued expenses, the
 carrying amount approximate fair value due to their short maturities.

 Concentrations and Uncertainties
 --------------------------------
 For fiscal year 1996, the Company's ten largest customers accounted for
 approximately 82% of the Company's net sales.  Two of these customers
 accounted for 22% and 20% of the Company's net sales, respectively.  The loss
 of one or both of these customers would have a negative short-term affect on
 the Company's financial position, results of operations and cash flows.  The
 Company has been informed by one of these customers that it will no longer
 use the Company as a major supplier after February 1997.

 The intense competition in the magnetic media field has made it difficult for
 the Company to maintain prices on its products.  There are substantial
 competitors in each of the Company's markets that have greater resources than
 the Company in order to gain more recognition.

 The Company purchases substantially all of its materials for audio and video
 cassettes from sources both in the Far East and Mexico.

                                    16
 Recently Issued Accounting Pronouncement
 ----------------------------------------
 In November 1995, the Financial Accounting Standards Board issued Statement
 of Financial Accounting Standards No. 123, "Accounting for Stock-Based
 Compensation," (FAS 123) effective for fiscal years beginning after December
 15, 1995.  FAS 123 establishes and encourages the use of the fair value based
 method of accounting for stock-based compensation arrangements under which
 compensation cost is determined using the fair value of stock-based
 compensation determined as of the date of grant, and is recognized over the
 periods in which the related services are rendered.  The statement also
 permits companies to elect to continue using the current implicit value
 accounting method specified in Accounting Principles Bulletin Opinion No. 25,
 "Accounting for Stock Issued to Employees" (APB 25) to account for
 stock-based compensation.  If the Company were to retain its current implicit
 value based method, it will be required to disclose the pro forma effect of
 using the fair value based method to account for its stock-based 
 compensation.  The Company intends to continue accounting for stock options
 under the APB 25 based method.

Note 2 - Note Receivable
------------------------
 The Company has a note receivable from an unrelated party which is
 collateralized by a first deed of trust and assignment of rents on commercial
 property.  The note was originally due in November 1996 and bore interest
 (payable monthly) at 14% per annum.  At October 31, 1995 this note was in
 default and the maker of the note filed a Chapter 11 Bankruptcy Proceeding. 
 Pending disposition of the Bankruptcy proceeding, maker agreed to pay 
 interest on the note.  The cost  of the collection of the note, carried as a
 receivable, is $68,000 as of October 31, 1996.  It is anticipated that an
 additional $7,000 in costs will be spent on collection prior to effectiveness
 of the plan of reorganization.  In October 1996, the Bankruptcy Court entered
 an order confirming the plan of reorganization which subsequently become
 effective.  Under the plan, the basic note of $250,000 together with the
 total costs of collection, was modified so that it bears interest at the rate
 of 12 3/4% per annum and is due and payable on or before August 1, 1998.  The
 Company believes that the collateral is sufficient to cover all amounts due.

Note 3 - Marketable Securities
------------------------------
 The Company has investments in marketable equity securities, which have been
 classified as non current, available-for-sale, at October 31, 1995 and 1996. 
 The investments in equity securities at October 31, 1995 had an original cost
 of $87,000 and a fair value of $115,000, resulting in gross unrealized gains
 of $31,000 and gross unrealized losses of $3,000 respectively.  The
 investments in equity securities at October 31, 1996 have an original cost of
 $114,000 and a fair value of $101,000, resulting in gross unrealized gains of
 $3,000 and gross unrealized losses of $16,000, respectively.

Note 4 - Note Payable
--------------------- 
 The Company elected not to renew its bank line of credit which expired on
 March 31, 1995.  The Company believes that it will be able to fund its
 existing business out of current cash flow without the necessity of bank
 borrowings, and therefore, concluded not to incur the cost of extending and
 maintaining the bank line of credit until such time as bank borrowings are
 required. 

                                    17


Note 5 - Stockholders' Equity 
-----------------------------

 Under the Company's 1983 Stock Option Plan, 450,000 shares of common stock
 were reserved for issuance to officers, directors and key employees.  The
 1983  plan expired by its terms in January 1993.  The expiration of the 1983
 plan has no effect on outstanding options granted thereunder prior to the
 expiration of the 1983 plan.

 The Company's Executive Stock Option Plan (the "Executive Plan") was approved
 by stockholders in March 1989.  In January 1995, the Board of Directors
 adopted an amendment to the Executive Plan changing its name to the Executive
 Stock Option Plan, increasing the number of shares of Common Stock covered
 thereby from 150,000 to 300,000 and extending the expiration date of the
 Executive Plan from January 1999 to January 2005.  The increase in the number
 of shares and the extension of the expiration date of the plan were approved
 by stockholders in March 1995.  Options under the plan have been reserved for
 issuance to officers, directors and key employees.

 Options under both Plans may be exercised in various installments, may not be
 exercised beyond ten years and the option price may not be less than the fair
 market value of the common stock on the date the option is granted.
<TABLE>
<CAPTION>

                                        Options  
                             Shares   granted and                    Options  
  1983 Stock Option Plan    reserved  outstanding   Price Range    Exercisable
--------------------------  --------  -----------   -----------    -----------

 <S>                       <C>        <C>         <C>             <C>
 Balance, October 31, 1993     -        153,000    $.937 - $1.66

 Cancelled                     -       ( 20,000)   $.937 - $1.50
                            --------    -------
 Balance, October 31, 1994              133,000    $.937 - $1.66
 
 Cancelled                             (  9,000)   $.968 - $1.50
                            --------    -------
 Balance, October 31, 1995     -        124,000    $.968 - $1.50      

 Cancelled                     -       ( 60,000)   $.968    
                            --------    -------
 Balance, October 31, 1996     -         64,000    $.968 - $1.66     64,000
                            ========    =======                      ======
</TABLE>














<TABLE>
<CAPTION>
                                        Options  
 Executive Stock             Shares   granted and                   Options  
   Option Plan              reserved  outstanding   Price Range   Exercisable
--------------------------  --------  -----------   -----------   -----------

 <S>                        <C>        <C>        <C>              <C>
 Balance, October 31, 1993   10,000     140,000    $1.060 - $1.719

 Cancelled                   60,000    ( 60,000)   $1.625         
                            -------     -------
 Balance, October 31, 1994   70,000      80,000    $1.060 - $1.719

 Increase in Shares Reserved
  for Issuance              150,000 
 Granted                   ( 10,000)     10,000    $0.810         
 Cancelled                   20,000    ( 20,000)   $1.060 - $1.719
                            -------     ------- 
 Balance, October 31, 1995  230,000      70,000    $0.810 - $1.375      

 Granted                   ( 64,500)     64,500    $1.00     
 Cancelled                   30,000    ( 30,000)   $1.375    
                            -------     -------   
 Balance, October 31, 1996  195,500     104,500    $0.810 - $1.375   40,000
                            =======     =======                      ======
</TABLE>






























                                      18                                   


Note 6 - Taxes on Income
------------------------

 The provision for taxes on income is comprised of the minimum state income
 taxes of $1,000.

 A reconciliation of the federal statutory rates to the effective rates is
 summarized as follows:
<TABLE>
<CAPTION>

                                           Year Ended October 31,
                                       ------------------------------       
                                       1996        1995         1994
                                       -----       -----        -----   
   <S>                                 <C>        <C>          <C>
   Statutory rate                      34.0%      (34.0%)      (35.0%)         
   State taxes, net of 
      federal benefit                   3.5          .1           .6           
   Unrecognized benefit (utilization) 
      of net operating losses         (34.0 )      33.9         34.4           
                                       -----      ------        ------         
   Effective tax rate                   3.5%         - %       (  -  %)
                                       =====      ======        ======         
</TABLE>

 For federal income tax return purposes, net operating losses of approximately
 $2,371,000 are available through October 31, 2005.  For state income tax
 purposes, net operating losses of approximately $1,048,000 which expire
 beginning October 31, 1995.  The company also has general business credit
 carry forwards totalling $96,000 that expire in fiscal year 2000.

 Significant components of the Company's deferred tax liabilities for income
 taxes consist of the following:
<TABLE>
<CAPTION>
                                          October 31,   October 31,
                                              1996           1995
                                           ----------     ----------    
   <S>                                     <C>            <C>
   Net operating loss carry forward        $  873,000     $  947,000 
   Vacation and severance accruals             69,000         72,000 
   Allowance for bad debts                     16,000         16,000 
   Inventory                                  172,000        124,000 
   Depreciation                                 9,000           -    
   Loss on marketable equity securities       136,000        136,000 
   General business credit                     96,000         42,000
                                           ----------     ----------  
      Total deferred tax assets             1,371,000      1,337,000 
   Valuation allowance for deferred
      tax assets                          ( 1,371,000)   ( 1,337,000)
                                           ----------     ----------
                                           $     -        $     -    
</TABLE>

 The deferred tax assets have been offset in entirety by a valuation allowance
 due to the uncertainty of their realization.



Note 7 - Commitments
--------------------


  Operating Leases - 

  The Company leases office, production and warehouse facilities under
long-term operating leases.  The Company leases its office space from Louart
Corporation ("Louart"), a stockholder of the Company.  Aggregate minimum net
lease payments under non-cancelable operating leases having initial or
remaining terms of more than one year are as follows:
<TABLE>
<CAPTION>
           Year Ending    Related
           October 31,     Party 
           -----------    -------        
              <C>           <C>
              1997          88,000
              1998          73,000
                          --------
                          $161,000
</TABLE>







                                    19






























  Total rental expense charged to operations amounted to $199,000, $183,000
  and $443,000 for the years ended October 31, 1996, 1995 and 1994
  respectively. Rent paid to Louart for the years ended October 31, 1996, 1995 
  and 1994 totalled $144,000, $130,000 and $138,000 respectively.

  Some leases contain renewal options, inflation escalation clauses and under
  some leasing arrangements, the Company pays maintenance, insurance, taxes
  and other expenses in addition to the above minimum annual rentals.

  Employment Contract - 

  On November 1, 1993, the Company entered into an employment agreement with
  its Chairman/Chief Executive Officer under which the Company is committed to
  annual salary payments to the officer in the amount of $200,000 through
  fiscal 1998.  During the fiscal year ended October 31, 1996, the Chairman
  and CEO voluntarily reduced his compensation to $175,000 for that year.
  

Note 8 - Industry Segment Information
-------------------------------------

  The Company operates principally in two segments:  magnetic media products
  and contract assembly.  Operations in magnetic media products primarily
  involve the design, development, assembly and sale of blank magnetic media
  and related products.

  Sales to two single customers in the magnetic media products field accounted
  for $2,249,473 (41.8% of total magnetic media sales) in 1996; $819,000 (21%
  of total magnetic media sales) and $494,000 (12.6%) in 1995 and  $713,000
  (17%) and $452,000 (11%) in 1994.  Receivables from these customers totalled
  $172,000 and $56,000, respectively at October 31, 1996.
  
  Identifiable assets by industry segment are those that are used in the
  Company's operation in each industry.  Corporate assets are principally cash
  and other assets.



















                                  20





<TABLE>
<CAPTION>
Financial information for 1996, 1995  and 1994 by industry segment, is
summarized as follows:

                                          1996         1995         1994    
                                       ----------   ----------   ---------- 
  Net sales to unaffiliated customers:
   <S>                                 <C>          <C>          <C>
   Magnetic media products             $5,382,000   $3,895,000   $4,182,000
   Contract assembly                       -             5,000    3,769,000    
                                       ----------   ----------   ----------
   Consolidated                        $5,382,000   $3,900,000   $7,951,000    
                                       ==========   ==========   ==========
  Operating profit:
   Magnetic media products             $  911,000   $  365,000   $  377,000    
   Contract assembly                       -            -           404,000    
                                       ----------   ----------   ----------
                                          911,000      365,000      781,000    
   
  General corporate expenses          (   978,000) (   961,000) ( 1,034,000)   
  Realized loss on marketable
    securities                             -       (   341,000)      -     
  Interest expense                    (    13,000) (    14,000) (    13,000) 
  Other income-interest                   109,000      178,000       97,000    
                                       ----------    ----------   ---------
  Income (loss) before taxes on income
    (benefit) and extraordinary credit $   29,000  ($  773,000) ($  169,000)   
                                       ==========   ==========   ========== 

  Identifiable assets:
   Magnetic media products             $2,652,000   $1,638,000   $2,387,000    
   Contract assembly                       -            -           340,000    
                                       ----------   ----------   ----------
      Total identifiable assets         2,652,000    1,638,000    2,727,000    
  
   General corporate assets             1,410,000    2,327,000    1,983,000   
                                       ----------   ----------   ---------- 
      Total assets                     $4,062,000   $3,965,000   $4,710,000    
                                       ==========   ==========   ==========

  Depreciation and amortization:
   Magnetic media products             $   51,000   $   55,000   $  102,000    
   Contract assembly                       -            -            -         
                                       ----------   ----------   ----------
      Total depreciation and 
      amortization                     $   51,000   $   55,000   $  102,000    
                                       ==========   ==========   ==========
  Capital expenditures:
   Magnetic media products             $  105,000   $   57,000   $   11,000    
   Contract assembly                       -             -            -
                                       ----------   ----------   ----------    
       Total capital expenditures      $  105,000   $   57,000   $   11,000
                                       ==========   ==========   ==========   

</TABLE>

                                    21


  Intercompany transfers to the Company's wholly owned subsidiary operating
  under a Maquiladora program in Mexicali, B.C., Mexico amounted to $411,000
  (1996), $359,000 (1995), and  $3,225,000 (1994).  The net book value of
  tangible identifiable assets of the subsidiary amounted to $97,000 at
  October 31, 1996.


Note 9 - Related Party Transactions
-----------------------------------

  The Company made payments to Louart, a stockholder of the Company, for rent
  of warehouse and office space, secretarial and administrative services, and
  an automobile.  These fees are included in selling, general and 
  administrative expenses.

  The payments made to Louart for these items are as follows:
<TABLE>
<CAPTION>
           <C>      <C>
           1996     $256,000
           1995     $259,000
           1994     $231,000
</TABLE>
       


Note 10 - Cash
--------------

  The Company maintains cash deposits at several banks located in California. 
  Deposits at each bank are insured by the Federal Deposit Insurance
  Corporation up to $100,000.  As of October 31, 1996, uninsured portions of
  balances held at those bank aggregated to $599,000.

























                                   22

Item 9.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure.
------------------------------------------------------------------------


     There have been no reported disagreements on any matter of accounting
principles or practices or financial statement disclosure of a kind described
in Item 304 of Regulation S-K.







                                 PART III



  The information called for by Part III (items 10, 11, 12 and 13) is
incorporated by reference from Certron's definitive proxy statement to be
filed pursuant to  Regulation 14A which involves the election of directors and
which Certron intends to file with the Securities and Exchange Commission not
later than 120 days after October 31, 1996, the end of the fiscal year covered
by this Form 10-K.  If such definitive proxy statement  is not filed with the
Securities and Exchange Commission in the 120-day period, the items comprising
the Part III information will be filed as an amendment to this Form 10-K,
under cover of Form 8, not later than the end of the 120-day period.































                                    23
                                  PART IV



Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K.
--------------------------------------------------------------------------


(a) 1.FINANCIAL STATEMENTS

    The following consolidated financial statements of Certron Corporation
    and its subsidiary are included in Part II, Item 8:


    Report of Independent  Certified Public Accountants - 
      Singer Lewak Greenbaum & Goldstein LLP                            10
    Consolidated balance sheets - October 31, 1996 and 1995             11
    Consolidated statements of operations - years ended
      October 31, 1996, 1995 and 1994                                   12
    Consolidated statements of stockholders' equity - years
      ended October 31, 1996, 1995 and 1994                             13
    Consolidated statements of cash flows - years ended
      October 31, 1996, 1995 and 1994                                   14
    Notes to consolidated financial statements                          15


 2. FINANCIAL STATEMENT SCHEDULES

    Schedule II - Valuation and qualifying accounts                     26
    

    All other schedules are omitted because they are not applicable or not
    required, or because the required information is included in the
    consolidated financial statements or notes thereto.




















                                    24





3.  EXHIBITS


    3.1     Articles of Incorporation of Registrant, as amended (incorporated
by reference to Exhibit 3.1 to Registrant's Annual Report of from 10-K for the
year ended October 31, 1981 and Exhibit "A" and Exhibit "B" to Registrant's
Proxy Statement dated February 17, 1988).

    3.2     By-Laws of Registrant, as amended (incorporated by reference to
Exhibit 3.2 to Registrant's Quarterly Report on form 10-Q for the quarter
ended April 30, 1989).

    *10.1   Registrant's 1983 Stock Option Plan (incorporated by reference to
Exhibit "A" to REGISTRANT's Proxy Statement dated February 14, 1983).

    *10.2   First Amendment to Registrant's 1983 Stock Option Plan
(incorporated by reference to Exhibit 10.2 to Registrant's Annual Report on
form 10-K for the year ended October 31, 1986).

    *10.3   Second Amendment to Registrant's 1983 Stock Option Plan
(incorporated by reference to Exhibit 10.3 to Registrant's Annual Report on
form 10-K for the year ended October 31, 1986).

    *10.4   Registrant's 1989 Stock Option  Plan (incorporated by reference
to Exhibit "B" to Registrant's Proxy Statement dated February 21, 1989).

    *10.5   Amendment to Registrant's 1989 Stock Option Plan (incorporated by
reference to Exhibit 10.5 to Registrant's Annual Report on form 10-K for the
year ended October 31, 1995.)

    10.6    Form of Indemnification Agreement between Registrant and its
Directors and selected officers and agents (incorporated by reference to
Exhibit "C" to Registrant's Proxy Statement dated February 17, 1988).

    *10.7   Employment Agreement effective as of November 1, 1993 between
Registrant and Marshall I. Kass (incorporated by reference to Exhibit 10.1 to
Registrant's Quarterly Report on Form 10-Q for quarter ended January 31,
1994).

    21.     Subsidiaries of Registrant (incorporated by reference to Exhibit
22 to Registrant's Annual report on form 10-K for the year ended October 31,
1981).

    23      Singer Lewak Greenbaum and Goldstein LLP consent.

    27      Financial Data Schedule

*   Indicates management contract or compensation plan or arrangement required
to be filed as an Exhibit to this Form 10-K

(b)         During the fourth quarter of Registrant's fiscal year ended
October 31, 1996, no reports on form 8-K were filed by Registrant.


                                    25





<TABLE>
<CAPTION>
                    CERTRON CORPORATION AND SUBSIDIARY  
                    ----------------------------------

              SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
              -----------------------------------------------     



                              Balance at Additions    Balance at   Balance at
                              beginning  charged to   accounts      end of  
Classifications               of period    expense    written off    period  
---------------               ---------  ---------    -----------  ----------

<S>        
YEAR ENDED OCTOBER 31, 1996
  Allowance for doubtful 
  <S>                          <C>       <C>           <C>          <C>
  accounts                     $40,000   (   0  )        0          $40,000
                               =======    ======       ======       ======= 

YEAR ENDED OCTOBER 31, 1995
  Allowance for doubtful 
  accounts                     $71,000       0         31,000       $40,000
                               =======    ======       ======       =======


YEAR ENDED OCTOBER 31, 1994
  Allowance for doubtful 
  accounts                     $65,000     6,000         0          $71,000
                               =======    ======       ======       =======


</TABLE>























                                    26

                                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)   CERTRON CORPORATION

BY (SIGNATURE)     /s/ Marshall I. Kass
(NAME AND TITLE)   Marshall I. Kass
                   Chairman of the Board and
                   Chief Executive and 
                   Operating Officer
                   January 28, 1997

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


BY (SIGNATURE)      /s/ Marshall I. Kass
(NAME AND TITLE)    Marshall I. Kass
                    Chairman of the Board and    
                    Chief Executive Officer and Director
                    (Principal Executive Officer and
                    Principal Financial Officer)
                    January 28, 1997

BY (SIGNATURE)      /s/ Jonathan F. Kass
(NAME AND TITLE)    President and Director
                    January 28, 1997


BY (SIGNATURE)      /s/ Michael S. Kass
(NAME AND TITLE)    Michael S. Kass
                    Executive Vice President and Director
                    January 28, 1997


BY (SIGNATURE)      /s/ Susan E. Kass
(NAME AND TITLE)    Secretary-Treasurer and Director
                    January 28, 1997

BY (SIGNATURE)      /s/ Jesse A. Lopez
(NAME AND TITLE)    Jesse A. Lopez
                    Corporate Controller and Director 
                    (Principal Accounting Officer)
                    January 28, 1997


BY (SIGNATURE)      /s/ Herbert Bronsten
(NAME AND TITLE)    Director
                    January 28, 1997


BY (SIGNATURE)      /s/ Rogelio Buenrostro
(NAME AND TITLE)    Director
                    January 28, 1997

                                    27


                              EXHIBIT  INDEX

    Exhibit No.                 Description                   Page
    -----------                 -----------                   ----

    3.1  Articles of Incorporation of Registrant, as amended (incorporated by
reference to Exhibit 3.1 to Registrant's Annual Report of from 10-K for the
year ended October 31, 1981 and Exhibit "A" and Exhibit "B" to Registrant's
Proxy Statement dated February 17, 1988).

    3.2  By-Laws of Registrant, as amended (incorporated by reference to
Exhibit 3.2 to Registrant's Quarterly Report on form 10-Q for the quarter
ended April 30, 1989).

    *10.1 Registrant's 1983 Stock Option Plan (incorporated by reference to
Exhibit "A" to REGISTRANT's Proxy Statement dated February 14, 1983).

    *10.2 First Amendment to Registrant's 1983 Stock Option Plan (incorporated
by reference to Exhibit 10.2 to Registrant's Annual Report on form 10-K for
the year ended October 31, 1986).

    *10.3 Second Amendment to Registrant's 1983 Stock Option Plan
(incorporated by reference to Exhibit 10.3 to Registrant's Annual Report on
form 10-K for the year ended October 31, 1986).

    *10.4 Registrant's 1989 Stock Option  Plan (incorporated by reference to
Exhibit "B" to Registrant's Proxy Statement dated February 21, 1989).

    *10.5 Amendment to Registrant's 1989 Stock Option Plan (incorporated by
reference to Exhibit 10.5 to Registrant's Annual Report on form 10-K for the
year ended October 31, 1995.)

    10.6 Form of Indemnification Agreement between Registrant and its
Directors and selected officers and agents (incorporated by reference to
Exhibit "C" to Registrant's Proxy Statement dated February 17, 1988).

    *10.7 Employment Agreement effective as of November 1, 1993 between
Registrant and Marshall I. Kass (incorporated by reference to Exhibit 10.1 to
Registrant's Quarterly Report on Form 10-Q for quarter ended January 31,
1994).

    21.  Subsidiaries of Registrant (incorporated by reference to Exhibit 22
to Registrant's Annual report on form 10-K for the year ended October 31,
1981).

    23   Singer Lewak Greenbaum and Goldstein LLP consent.

    27   Financial Data Schedule

*   Indicates management contract or compensation plan or arrangement required
to be filed as an Exhibit to this Form 10-K

(b)      During the fourth quarter of Registrant's fiscal year ended October
31, 1996, no reports on form 8-K were filed by Registrant.

/TEXT>