Remove giblets from squabs; reserve for other uses. Rinse squabs with cold water; pat dry.
Melt butter in a large skillet; add squabs, bacon, onion, carrot, and salt. Sauté until squabs are lightly browned on all sides and vegetable mixture is tender. Add mushrooms and wine; cover and simmer 45 minutes. Serve each squab on toasted bread; spoon sauce over squabs.