UNITED STATES
                 SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C.  20549

                                FORM 10-Q



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


For the Quarter Ended  December 31, 1998     Commission File Number 0-12283


                           ZONIC CORPORATION
          (Exact name of Registrant as specified in its charter)



                Ohio                                   31-0791199
                ----                                   ----------
     (State of Incorporation)                      (I.R.S. Employer 
                                                 Identification Number)

   50 West Technecenter Drive, Milford, Ohio          45150-9777
   -----------------------------------------          ----------
    (address of principal executive offices)          (Zip Code)


   Registrant's telephone number, including area code:  (513) 248-1911
                                                        --------------


                               Not Applicable
                               --------------
(Former name, address or fiscal year if changed since last report)


Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by Section 13 or 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 total number of shares outstanding of the issuer's common shares, without 
par value, as of the date of this report, follow:



                                 3,044,136




Part I 	Financial Information
Item 1. Financial Statements

STATEMENT OF OPERATIONS
(unaudited)

                                Three Months Ended      Nine Months Ended

                               12/31/98   12/31/97    12/31/98   12/31/97
                               --------   --------    --------   --------

Products and 
     service revenues        $ 624,975  $ 699,308  $ 1,691,541  $ 1,520,103 

Cost of products and 
     services sold             217,110    282,514      605,750      597,259 
Selling and 
     administrative expenses   261,442    260,600      769,654      843,197 
Research and development
     expenses and software
     construction and product
     enhancement amortization   50,299     59,254      154,130     258,011 
                              --------    -------      -------     -------

                               528,851    602,368    1,529,534   1,698,467 

Operating profits (loss)        96,124     96,940      162,007    (178,364)

Interest expense, net           (1,092)   (50,849)      (6,333)   (142,169)
Foreign currency gain              875        612          875           - 
                                   500          -          500          29
                               -------   --------     --------     -------

Income (loss) before taxes      96,407     46,703      157,049    (320,504)

Provision for income taxes           -          -            -           -
                               -------   --------     --------    --------

Net income (loss)               96,407     46,703      157,049    (320,504)

Less: Dividend payable 
     on preferred shares       (20,600)         0      (34,128)          0
                               -------    -------     --------    --------

Net income (loss) available 
     to common shareholders   $ 75,807   $ 46,703    $ 122,921  $ (320,504)
                              ========   ========    =========  ==========

Basic and diluted 
     income (loss) per share      0.02       0.02         0.04       (0.11)
                                ======     ======       ======      ======

Weighted average 
     shares outstanding    $ 3,044,136 $3,044,136   $3,044,136  $3,044,136 


The accompanying notes are an integral part of these financial statements.





Item 1 - Financial Statements  (continued)
BALANCE SHEETS
As of December 31, 1998 & March 31, 1998
                                       (unaudited)
                                         Dec.  31         Mar. 31
ASSETS                                     1998            1998
                                         --------         -------
Current Assets
     Cash                              $  95,052       $  79,408 
     Receivables
          Trade                          174,813         248,519 
          Related parties                      -           1,708 
                                       ---------       ---------
     Total receivables                   174,813         250,227 
     Inventories 
          Finished products               27,337         144,718 
          Work in process                106,805          49,111 
          Raw material                    88,826          71,766 
                                       ---------       ---------
     Total inventories                   222,968         265,595 
     Prepaid expenses                     11,193           3,734 
                                       ---------       ---------
          Total Current Assets           504,026         598,964 
 
Property and Equipment-at Cost 
     Furniture and office equipment      447,693         452,417 
     Machinery and plant equipment       602,232         597,022 
     Software construction and 
          product enhancement          2,203,070       2,203,070 
                                       ---------       ---------
                                       3,252,995       3,252,509 
     Less accumulated depreciation 
          and amortization             3,189,471       3,151,876 
                                       ---------       ---------

                                          63,524         100,633 
                                       ---------       ---------
               Total Assets            $ 567,550       $ 699,597 
                                       =========       =========

LIABILITIES
Current Liabilities
     Short-term notes payable 
          and current maturities
          of long-term debt            $  29,630       $  42,365 
     Accounts payable - trade            610,229         728,062 
     Accounts payable - related parties        -           4,223 
     Dividend payable                     34,128               - 
     Deferred income                     273,972         365,258 
     Accrued liabilities
          Salaries and wages             137,032         108,947 
          Property and payroll taxes      47,888          54,684 
          Commissions                     91,983          95,066 
          Other                           32,109          31,986 
                                        --------        --------
             Total Accrued Liabilities   309,012         290,683 
                                         -------        --------
 
             Total Current Liabilities 1,256,971       1,430,591 

Long-Term Obligations, 
     Less Current Maturities              11,460          30,186 
 
Deferred rent                             55,663         118,285 
 
SHAREHOLDERS' EQUITY (DEFICIT)
     Preferred shares                  2,400,000       2,400,000 
     Common shares                        61,674          61,674 
     Additional paid-in capital        5,727,881       5,727,881 
                                       ---------       ---------
                                       8,189,555       8,189,555 

     Accumulated deficit              (8,946,099)     (9,069,020)
                                      ----------      -----------
         Total Shareholders' Equity     (756,544)       (879,465)
                                      ----------      -----------
 					
         Total Liabilities and 
            Shareholders' Equity      $  567,550      $  699,597
                                      ==========      ==========


The accompanying notes are an integral part of these financial statements.

Item 1 - Financial Statements  (continued)

STATEMENT OF SHAREHOLDERS' DEFICIT
For the nine months ended December 31, 1998
(unaudited)

                                      Additional
               Common     Preferred    Paid - In    Accumulated
               Shares       Shares      Capital       Deficit       Total
              -------    ----------  -----------    -----------     -----
Balance, 
March 31, 
1998           $61,674   $2,400,000   $5,727,881   $(9,069,020)   $(879,465)

Net income 
for the period       -            -            -       157,049      157,049 

Dividends 
payable on 
preferred shares     -            -            -       (34,128)     (34,128)
                ------  -----------    ---------   -----------     --------

Balance, 
December 31, 
1998           $61,674   $2,400,000   $5,727,881   $(8,946,099)   $(756,544)
               =======   ==========   ==========   ===========    =========






The accompanying notes are an integral part of these financial statements.
Item 1 - Financial Statements  (continued)
STATEMENTS OF CASH FLOWS
For the nine months ended December 31,
(unaudited)
                                                           1998        1997
                                                         ------      ------
Cash provided (used) by operations
    Net income (loss) for period                        157,049    (320,504)
    Adjustments to reconcile net 
           loss to cash from operations
        Depreciation and amortization                    13,637      15,467 
        Amortization of software construction
               and product enhancements                  29,487     103,000 
        Amortization of note receivable 
               from shareholder                               -     (30,000)
        Provision for obsolete inventory                 18,000      27,000 
        Amortization of deferred income and 
               deferred rent                           (158,765)   (159,372)
        Gain on sale of assets                             (500)     (3,624)
        Foreign currency gain and other                    (875)        (29)

    Increase (decrease) in cash due to changes in
        Accounts receivable                              70,813      55,916 
        Inventories                                      24,627      20,873 
        Prepaid expenses                                 (7,459)    (11,546)
        Accounts payable                               (116,581)     33,333 
        Accrued liabilities                              18,329      (2,235)
        Accrued rent                                          -     (64,079)
        Deferred income                                   4,857      84,813 
                                                       --------    --------

             Net cash provided (used) by operations      52,619    (250,987)

Cash used in investment activities
        Purchase of equipment                            (6,014)     (6,225)
        Proceeds from the sale of fixed assets              500      13,510 
        Increase in software construction and 
           product enhancements                               -     (42,203)
                                                        -------    --------

             Net cash used in investment activities      (5,514)    (34,918)

Cash provided by financing activities
        Additions to debt obligations                         -      75,000 
        Payments on debt obligations                    (31,461)    (15,432)
                                                        -------     -------

             Net cash provided (used) by 
                financing activities                    (31,461)     59,568 

Increase (decrease) in cash                              15,644    (226,337)
Cash - beginning of period                               79,408     259,494 
                                                       --------     -------

Cash - end of period                                  $  95,052    $ 33,157 
                                                      =========    ========

Interest paid during period                           $   3,669    $ 22,419 
                                                      =========    ========

The accompanying notes are an integral part of these financial statements.
Item 1 - Financial Statements  (continued)
Notes to Financial Statements

1.   Presentation of Information

In the opinion of management, the accompanying unaudited financial statements 
reflect all adjustments (consisting of only normal recurring adjustments) 
necessary to present fairly Zonic Corporation's (the Company) financial position
at December 31, 1998 and the results of operations for the three and nine month 
periods ended December 31, 1998 and 1997 and its cash flows for the nine month 
periods ended December 31, 1998 and 1997.  
The results of operations for the interim periods are not necessarily indicative
of results to be expected for a full year.

The financial statements are summarized and should be read in conjunction with 
the annual report to shareholders and Form 10-K for the year ended March 31, 
1998. Certain reclassifications have been made to amounts shown for the prior 
year to conform to current year classifications.

2.  New Standards

The Company implemented Statement of Financial Accounting Standards (SFAS) No. 
130, "Reporting Comprehensive Income" during the first quarter of the current 
year.  Under the provisions of this Statement, all changes in 
equity that result from recognized transactions and other economic events 
of the period other than transactions with owners in their capacity as owners 
are reported as comprehensive income.  As required by the statement, 
comprehensive income should be reported as net income and other comprehensive 
income with a total amount displayed in the financial statements.  Since the 
Company has no items of other comprehensive income during the current year, 
comprehensive income is not reported.

The Company will implement Statement of Financial Accounting Standards (SFAS) 
No. 131, "Disclosures about Segments of an Enterprise and Related Information" 
in the annual financial statements of the current year.  This statement requires
disclosure of certain information for each operating segment of a business 
enterprise.  Specific criteria is included in this statement to determine 
reportable segments of the business.  The Company 
has a single reportable segment.  Revenues and the loss for this segment 
are reported in the accompanying Statement of Operations. Adoption of the 
statement will not impact the reported results of operations of the Company and 
will not require additional disclosure.

3.  Year 2000 Issues

The Company defines Year 2000 compliance as proper functionality, or performance
of a system, process, or equipment that is not adversely affected by dates prior
to, during, and after the year 2000.  Due to memory constraints, early 
programmers represented years by the last two digits of the century.  Thus the 
year 1970 is represented by the number "70" in many older software programs.  At
the turn of the century, the year will become "00" and the computer or system 
will interpret this as the year 1900 and not the year 2000.  Many systems have 
electronic components that utilize a date to control the function it serves.  
Most computer software, including the Company product offerings, utilize date 
identification.

The Company has initiated a comprehensive review and evaluation of all relevant 
internal and external systems, processes, and third party providers to 
determine their compliance or progress toward Year 2000 compliance.  This 
review is to be completed by March 31, 1999.  If a system, process or third 
party provider is deemed significant to the operations of the Company and Year 
2000 compliance is in question, the Company will develop a contingency plan to 
address the issue.  At this time the Company has not encountered nor anticipates
any significant Year 2000 issues requiring a contingency plan.

The Company's product offerings utilize date reference for the identification of
printed and stored data.  A date reference problem 
will result in stored data being tagged with an incorrect date, or 
printed data indicating an incorrect date. The Company has determined 
that certain legacy products will not be reviewed for Year 2000 
compliance.  All current products will be Year 2000 compliant.  This information
has been provided to the Company's clients and the information is available on 
the company's WEB site.

At this time the review process is 85% complete and the Company has discovered 
no material Year 2000 compliance issues.  The Company has not incurred nor 
anticipates any additional significant expenses as a result of its on-going 
Year 2000 work.


4.  Dividend Payable on Preferred Stock

The Class B Preferred Stock of the Company includes an annual dividend 
equal to 20% of the Company's annual after-tax earnings excluding non-recurring 
earnings as defined and charges effective with the year 
ended March 31, 1999. The Company has recorded a dividend payable during 
the current three month and nine month periods equal to 20% of 
year-to-date net income as defined.  This amount is adjusted quarterly 
to equal 20% of the then current year-to-date net income.


Item 2 - Management's Discussion and Analysis of Financial Condition and 
         Results of Operations

Special Cautionary Notice Regarding Forward-Looking Statements
--------------------------------------------------------------

Certain of the matters discussed under the caption "Management's 
Discussion and Analysis of Financial Condition and Results of 
Operation" may constitute forward-looking statements for purposes of 
the Securities Act of 1933 and the Securities Exchange Act of 1934, 
as amended, and as such may involve known and unknown risks, 
uncertainties and other factors which may cause the actual results, performance 
or achievements of the Company to be materially different 
from future results, performance or achievements expressed or implied 
by such forward-looking statements.  Important factors that could cause 
the actual results, performance or achievement of the Company to differ 
materially from the Company's expectations include, without limitation, 
the following:  1) the Company is unable to improve existing products 
or develop new products which satisfy needs in the Company's markets; 2) 
the Company is unable to penetrate new markets; 3) the Company is unable 
to retain existing personnel or hire additional personnel; 4) the 
industries the Company serves experience less rapid growth than 
anticipated; 5) the Company is unable to obtain supplies on a timely 
basis from its limited number of suppliers; 6) new competitors enter the markets
the Company serves or existing competitors increase their marketing efforts; 
7) the Company is unable to obtain additional debt or equity financing on 
favorable terms, if at all, to satisfy its cash requirements.  All written or 
oral forward-looking statements attributable to the Company are expressly 
qualified in their entirety by such factors.


Results of Operations
---------------------

Product and Services Revenue decreased by $74,333, or 11% for the three months 
ended December 31, 1998, when  compared to the prior year period.  Sales 
increased in the Company's 7000 Series product line, but were 
offset by decreases in the WCA, MMS, and Medallion product lines.  The increase 
in 7000 Series revenue was due to sales under an order for eight systems 
received during the fourth quarter of fiscal 1998 which was completed during the
current period.  The decrease in Medallion revenue of approximately $103,000 
was due primarily to less sales to a company under an OEM distribution 
agreement.  For the nine months ended December 31, 1998, revenue increased by
$171,438 or 11% when compared to the same period of the prior year. Besides 
an increase in revenue from 7000 Series products for the nine month period, 
revenue also increased in WCA products as the result of sales made during the
first quarter of the current year and in Medallion products due to sales made 
to a company under an OEM distribution agreement earlier in the current fiscal 
year.  These increases were partially offset by declines in consulting, extended
warranty service and MMS product revenue attributable to the continuing slow 
down in orders resulting from the Company's sale of its Zeta technology and 
software to A&D Company, Ltd (A&D) in fiscal 1997.

Order backlog amounted to $272,000 at December 31, 1998 compared with $234,000 
at December 31, 1997. There was an increase in orders for 
Medallion and Medallion based products during the current three month period.  
This increase was partially offset by a decrease in orders for 
WCA and 35XX Series products and extended warranty service contracts.  

Costs of products and services sold were 35% and 36% respectively of products 
and services revenues for the three and nine months ended 
December 31, 1998 versus 40% and 39% respectively for the same periods of the 
prior year.  The decrease in costs was due mainly to higher profit margins on 
Medallion product sales resulting from add-on software and equipment options and
reduced production costs.

Selling and administrative expenses increased slightly during the current three 
month period versus the same prior year period, but decreased by $73,543 or 9% 
during the current nine month period versus the same period 
of the prior year.  There was a decrease in rent and other facility 
related costs, lower professional services expense, and sales commission expense
during the current three and nine month periods.  The decrease in sales 
commission expense was the result of fewer sales commissionable to sales 
representatives.  There were higher sales promotion costs during the current 
three and nine month periods which offset these decreases in the current three 
month period but only partially offset decreases for the current nine month 
period. Selling and administrative expenses were 42% 
and 46%, respectively, of product and service revenues for the current 
three and nine month periods versus 37% and 55%, respectively, for the 
same periods of the prior year.  The increased percentage for the current three 
month period was due mainly to lower revenues while the decreased percentage for
the current nine month period was the result of expense reductions and higher 
revenues.
 
Research and development expenses and software construction amortization 
was $50,299 and $154,130 respectively, for the three and nine month 
periods ended December 31, 1998 versus $59,254 and $258,011, respectively, for 
the same periods of the prior year. These decreases were due to less 
amortization expense as a result of a decrease in capitalized software 
construction and product enhancement costs during the past year.  See Software 
Construction and Product Development under Liquidity and Capital Resources.

Interest expense was $1,092 and $6,333, respectively, for the three and 
nine month periods ended December 31, 1998 versus $50,849 and $142,169, 
respectively,  for the same periods ended December 31, 1997.  This 
decrease was due to significantly less borrowings during the current year 
resulting from the retirement of outstanding current and long-term debt using 
proceeds from the sale of preferred stock to A&D in fiscal 1998.

Income tax expense was $32,778 and $53,397, respectively, for the three 
and nine months ended December 31, 1998 was offset by net operating loss 
carryforwards.  At March 31, 1998, loss carryforwards totaling $6.3 
million and tax credits of $646,000 were available to offset future 
income taxes.  No benefit from the Company's deferred tax assets has 
been provided at this time.

Dividend payable on preferred shares was $20,600 and $34,128, 
respectively, for the three and nine months ended December 31, 1998.  
See Dividend Payable on Preferred Stock under Notes to Financial 
Statements.

Liquidity & Capital Resources
------------------------
Software Construction and Product Development

The Company's total unamortized software construction and product enhancement 
costs at December 31, 1998 and March 31, 1998 were $14,896 
and $44,383, respectively. No costs were capitalized for software construction 
and product enhancement projects during the current nine 
month period compared to $42,203 for the prior year period. 
Working Capital and Cash Flow

The Company's working capital improved from a negative $831,627 at March 31, 
1998 to a negative $752,945 at December 31, 1998.  The current ratio 
declined slightly from .42 at March 31, 1998 to .40 at December 31, 1998.   The
change in working capital was due primarily to decreases in accounts payable and
deferred income which was partially offset by a decline in accounts receivable.

The Company's cash flows from operations amounted to $52,619 for the 
nine months ended December 31, 1998. Payments on long-term debt totaled $31,461.
There was no investment in software construction and product enhancement 
activities during the current period. 

The Company has experienced some improvement in its cash flow resulting 
from its operating profit during the current three and nine month periods, but 
continues to experience cash flow problems as current liabilities 
exceed current assets. The Company continues to seek additional working capital 
through debt or equity financing from public or private sources 
to reduce current liabilities and to sustain its operations.  There can 
be no assurance that the Company will be able to obtain additional 
financing on favorable terms, if at all, from any source.  

PART II - Other Information

None

Item 6:  Exhibits and Reports on Form 8-K

     Exhibit 11 - Computation of earnings per common share - see Statements 
                  of Operations

     Reports on Form 8-K  - Current reports on Forms 8-K amd 8-K/A 
     reporting on the Company's dismissal of Deloitte & Touche LLP and the
     selection of Clark, Schaefer and Hackett & Co. as its auditor were 
     filed on December 22, 1998 and December 29, 1998, respectively.

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the 
Registrant has duly caused this report to be signed by the undersigned thereunto
duly authorized.

ZONIC CORPORATION



By: /s/ James B. Webb
------------------------------------
    James B. Webb
    President and Chief Executive Officer



By: /s/ John H. Reifschneider
------------------------------------
    John H. Reifschneider
    Controller
    


Dated:  February 5, 1999