<PAGE>



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


                                    FORM 10-K

(X)  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 (FEE REQUIRED) FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003

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

                        Commission File Number: 33-69996

                       COMMONWEALTH INCOME & GROWTH FUND I
             (Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>

<S>                                                                 <C>
         Pennsylvania                                               23-2735641
(State or other jurisdiction of                      (I.R.S. Employer Identification Number)
incorporation or organization)
</TABLE>

                               470 John Young Way
                                 Exton, PA 19341
          (Address, including zip code, of principal executive offices)

                                 (610) 594-9600
               (Registrant's telephone number including area code)

         Indicate by check mark whether the registrant (i) 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, and (ii) has been subject to such filing
requirements for the past 90 days: YES [X] NO [ ]

         Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, to the best of Registrant's
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K:
YES [X]    NO [ ]

         Indicate by check mark whether the registrant is an accelerated filer
(as defined in Rule 12c-2 of the Act):    YES [ ]    NO [X]


                       DOCUMENTS INCORPORATED BY REFERENCE
(Specific sections incorporated are identified under applicable items herein)

         Certain exhibits to the Company's Registration Statement on Form S-1
(File No. 33-69996).


<PAGE>


PART I

ITEM 1: BUSINESS

GENERAL

         Commonwealth Income and Growth Fund I ( the "Partnership") was formed
on August 26, 1993 under the Pennsylvania Revised Uniform Limited Partnership
Act. The Partnership began offering $15,000,000 of Units of Limited Partnership
("Units") to the public on December 17, 1993 (the "Offerings"). The Partnership
terminated its offering of Units on May 11, 1995, with 631,358 Units
($12,623,682) admitted as Limited Partners of the Partnership.

         See "The Glossary" below for the definition of capitalized terms not
otherwise defined in the text of this report.

PRINCIPAL INVESTMENT OBJECTIVES

         The Partnership was formed for the purpose of acquiring various types
of Equipment, including computer peripheral and other similar capital equipment.
The Partnership utilized the net proceeds of the Offering to purchase IBM and
IBM compatible computer peripheral and other similar capital equipment. The
Partnership utilizes Retained Proceeds and debt financing (not to exceed 30% of
the aggregate cost of the Equipment owned or subject to Conditional Sales
Contract by the Partnership at the time the debt is incurred) to purchase
additional Equipment. The Partnership acquires and leases equipment principally
to U.S. corporations and other institutions pursuant to Operating Leases. The
Partnership retains the flexibility to enter into Full Payout Net Leases, Direct
Financing Leases and Conditional Sales Contracts.

         The Partnership's principal investment objectives are to:

         (a) acquire, lease and sell Equipment to generate revenues from
         operations sufficient to provide annual cash distributions to Limited
         Partners;

         (b) preserve and protect Limited Partners' capital;

         (c) use a portion of Cash Flow and Net Disposition Proceeds derived
         from the sale, refinancing or other disposition of Equipment to
         purchase additional Equipment; and

         (d) refinance, sell or otherwise dispose of Equipment in a manner that
         will maximize the proceeds to the Partnership.

THERE CAN BE NO ASSURANCE THAT ANY OF THESE OBJECTIVES WILL BE ATTAINED.

         Limited Partners do not have the right to vote on or otherwise approve
or disapprove any particular investment to be made by the Partnership.

         Although the Partnership has acquired predominately new Equipment, the
Partnership may purchase used Equipment. Generally, Equipment is acquired from
manufacturers, distributors, leasing companies, agents, owner-users,
owner-lessors, and other suppliers upon terms that vary depending upon the
Equipment and supplier involved. Manufacturers and distributors usually furnish
a limited warranty against defects in material and workmanship and some purchase
agreements for Equipment provide for service and replacement of parts during a
limited period. Equipment purchases are also made through lease brokers and on
an ad hoc basis to meet the needs of a particular lessee.

                                                                               2
<PAGE>

         As of December 31, 2003, substantially all Equipment purchased by the
Partnership is subject to an Operating Lease or an Operating Lease was already
entered into with a third party when the Partnership acquired an item of
Equipment. The Partnership may also engage in sale/leaseback transactions,
pursuant to which the Partnership would purchase Equipment from companies that
would then immediately lease the Equipment from the Partnership. The Partnership
may also purchase Equipment which is leased under Full Payout Net Leases, Direct
Financing Leases or sold under Conditional Sales Contracts at the time of
acquisition or the Partnership may enter into a Full Payout Net Lease, Direct
Financing Lease or Conditional Sales Contract with a third party when the
Partnership acquires an item of Equipment.

         The Partnership may enter into arrangements with one or more
manufacturers pursuant to which the Partnership purchases from such
manufacturers Equipment that has previously been leased directly by the
manufacturer to third parties ("vendor leasing agreements"). The Partnership and
manufacturers may agree to nonrecourse loans to the Partnership from the
manufacturers to finance the acquisition of Equipment secured by the Equipment
and the receivables due to the manufacturers from users of such Equipment. It is
expected that the manufacturers of Equipment will provide maintenance,
remarketing and other services for the Equipment subject to such agreements. As
of December 31, 2003, the Partnership has not entered into any such agreements.

         The General Partner has the discretion consistent with its fiduciary
duty to change the investment objectives of the Partnership if it determines
that such a change is in the best interest of the Limited Partners and so long
as such a change is consistent with the Partnership Agreement. The General
Partner will notify the Limited Partners if it makes such a determination to
change the Partnership's investment objectives.

         Commonwealth Capital Corp. filed a lawsuit on the Partnership's behalf,
alleging that the named defendant has not returned the proper leased equipment.
The lawsuit, which was originally filed in 2001, still has not been heard by the
court due to several postponements by the judge assigned to the lawsuit. The
Partnership has made several attempts to transfer the case to another judge. The
General Partner has decided that if the court does not hear the lawsuit by June
30, 2004, then the General Partner will seek to transfer the lawsuit and the
related lease receivable to a trust on behalf of the Partnership and begin the
liquidation phase of the Partnership as provided for in the original Partnership
agreement. If the court does not hear the lawsuit by June 30, 2004, then, if the
outcome of the lawsuit is favorable, the General Partner plans to use the
proceeds from the lawsuit and continue current Partnership operations and
purchase additional equipment leases, without paying fees to the General
Partner, with terms of approximately 12-24 months. If the outcome of the lawsuit
is not to the General Partner's satisfaction, then the General Partner plans to
begin the liquidation phase of the Partnership. If the Partnership's cash is
insufficient from operations or if the trust has insufficient cash, the General
Partner and CCC intend to fund the legal expenses associated with the lawsuit.


TYPES OF EQUIPMENT

         Computer Peripheral Equipment. Computer peripheral equipment consists
of devices used to convey information into and out of a central processing unit
(or "mainframe") of a computer system, such as tape drives, disk drives, tape
controllers, disk controllers, printers, terminals and related control units,
all of which are in some way related to the process of storing, retrieving, and
processing information by computer.

         The Partnership acquires primarily IBM manufactured or IBM compatible
equipment. The General Partner believes that dealing in IBM or IBM compatible
equipment is particularly advantageous because of the large IBM customer base,
policy of supporting users with software and maintenance services and the large
amount of IBM and IBM compatible equipment in the marketplace.

                                                                               3
<PAGE>

         Computer technology has developed rapidly in recent years and is
expected to continue to do so. Technological advances have permitted continued
reductions in the cost of computer processing capacity, thereby permitting
applications not economically feasible a few years ago. Much of the older IBM
and IBM compatible computer peripheral equipment has not been retired from
service, because software is generally interchangeable between older and newer
equipment, and older equipment is capable of performing many of the same
functions as newer equipment. The General Partner believes, historically, that
the values of peripheral equipment have been affected less dramatically by
changes in technology than have the values of central processing units. An
equipment user who upgrades to a more advanced central processor generally can
continue to use his existing peripheral equipment. Peripheral equipment
nevertheless is subject to declines in value as new, improved models are
developed and become available. Technological advances and other factors,
discussed below in Management Discussion and Analysis, have at times caused
dramatic reduction in the market prices of older models of IBM and IBM
compatible computer peripheral equipment from the prices at which they were
originally introduced.

         Other Equipment-Restrictions. The Partnership acquires computer
peripheral equipment, such as tape drives, disk drives, tape controllers, disk
controllers, printers, terminals and related control units, all of which are in
some way related to the process of storing, retrieving and processing
information by computer. The General Partner is also authorized, but does not
presently intend, to cause the Partnership to invest in non-IBM compatible
computer peripheral, data processing, telecommunication or medical technology
equipment. The Partnership may not invest in any of such other types of
Equipment (i) to the extent that the purchase price of such Equipment, together
with the aggregate Purchase Price of all such other types of Equipment then
owned by the Partnership, is in excess of 25% of the total cost of all of the
assets of the Partnership at the time of the Partnership's commitment to invest
therein and (ii) unless the General Partner determines that such purchase is in
the best economic interest of the Partnership at the time of the purchase and,
in the case of non-IBM compatible peripheral Equipment, that such Equipment is
comparable in quality to similar IBM or IBM compatible Equipment. There can be
no assurance that any Equipment investments can be found which meet this
standard. Accordingly, there can be no assurance that investments of this type
will be made by the Partnership.

DIVERSIFICATION

         Diversification is generally desirable to minimize the effects of
changes in specific industries, local economic conditions or similar risks.
However, the extent of the Partnership's diversification, in the aggregate and
within each category of Equipment, depends in part upon the financing which can
be assumed by the Partnership or borrowed from third parties on satisfactory
terms. The Partnership's policy not to borrow on a recourse basis will further
limit its financing options. Diversification also depends on the availability of
various types of Equipment. Through December 31, 2003, the Partnership has
acquired a diversified Equipment portfolio, which it has leased to 32 different
companies located throughout the United States. The allocations are as follows:

---------------------------------------------------------------------------
                    Equipment Type                      Approximate %
---------------------------------------------------------------------------
                       Servers                                 35%
---------------------------------------------------------------------------
                     Workstations                              23%
---------------------------------------------------------------------------
                    Tape Libraries                             16%
---------------------------------------------------------------------------
                   Escon Directors                              9%
---------------------------------------------------------------------------
                   Tape Subsystems                              6%
---------------------------------------------------------------------------
                   Optical Storage                              6%
---------------------------------------------------------------------------
                  High-End Printers                             2%
---------------------------------------------------------------------------
                       Routers                                  2%
---------------------------------------------------------------------------
                   Low-End Printers                             1%
---------------------------------------------------------------------------
                        Total                                  100%
---------------------------------------------------------------------------

                                                                               4
<PAGE>

         During the operational stage of the Partnership, the Partnership may
not at any one point in time lease (or sell pursuant to a Conditional Sales
Contract) more than 25% of the Equipment to a single Person or Affiliated group
of Persons.

DESCRIPTION OF LEASES

         The Partnership to date has purchased, and in the future intends to
continue to purchase only Equipment that is subject to a lease or for which a
lease or similar agreement will be entered into contemporaneously with the
consummation of the Partnership's acquisition of the Equipment. The General
Partner to date has leased and in the future intends to lease most of the
Equipment purchased by the Partnership to third parties pursuant to Operating
Leases. Operating Leases are relatively short-term (12 to 48 month) leases under
which the aggregate noncancellable rental payments during the original term of
the lease are not sufficient to permit the lessor to recover the purchase price
of the subject Equipment. The Equipment may also be leased pursuant to Full
Payout Net Leases. Full Payout Net Leases are leases under which the aggregate
noncancellable rental payments during the original term of the lease are at
least sufficient to recover the purchase price of the subject Equipment. It is
anticipated that the Partnership will enter into few, if any, Full Payout net
Leases. The General Partner may also enter into Conditional Sales Contracts for
Equipment. A Conditional Sales Contract generally provides that the
noncancellable payments to the seller over the term of the contract are
sufficient to recover the investment in such Equipment and to provide a return
on such investment. Under a Conditional Sales Contract, the seller reserves
title to, and retain a security interest in, the Equipment until the Purchase
Price of the Equipment is paid. As of December 31, 2003, the Partnership has not
entered into any Full Payout Net Leases or Conditional Sales Contracts for
Equipment and does not presently intend to do so. The Equipment may also be
leased pursuant to Capital Leases. Capital Leases are leases under which the
Equipment either transfers to the lessee at the end of the lease term, contains
a bargain purchase price option, the lease term is equal to 75% or more of the
estimated economic life of the Equipment, or the present value at the beginning
of the lease term of the minimum lease payments is equal to or exceeds 90% of
the excess of the fair value of the Equipment. As of December 31, 2003, we have
entered into one Capital Lease.

         In general, the terms of the Partnership's leases, whether the
Equipment is leased pursuant to an Operating lease, Capital Lease or a Full
Payout Net Lease, depend upon a variety of factors, including: the desirability
of each type of lease from both an investment and a tax point of view; the
relative demand among lessees for Operating, Capital Lease or Full Payout Net
Leases; the type and use of Equipment and its anticipated residual value; the
business of the lessee and its credit rating; the availability and cost of
financing; regulatory considerations; the accounting treatment of the lease
sought by the lessee or the Partnership; and competitive factors.

         An Operating Lease generally represents a greater risk to the
Partnership than a Capital Lease or Full Payout Net Lease, because in order to
recover the purchase price of the subject Equipment and earn a return on such
investment, it is necessary to renew or extend the Operating Lease, lease the
Equipment to a third party at the end of the original lease term, or sell the
Equipment. On the other hand, the term of an Operating Lease is generally much
shorter than the term of a Capital Lease or Full Payout Net Lease, and the
lessor is thus afforded an opportunity under an Operating Lease to re-lease or
sell the subject Equipment at an earlier stage of the Equipment's life cycle
than under a Capital Lease or Full Payout Net Lease. Also, the annual rental
payments received under an Operating Lease are ordinarily higher than those
received under a Capital Lease or Full Payout Net Lease.

         The Partnership's policy is to generally enter into "triple net leases"
(or the equivalent, in the case of a Conditional Sales Contract) which typically
provide that the lessee or some other party bear the risk of physical loss of
the Equipment; pay taxes relating to the lease or use of the Equipment; maintain
the Equipment; indemnify the Partnership-lessor against any liability suffered
by the Partnership as the result of any act or omission of the lessee or its
agents; maintain casualty insurance in an amount equal to the greater of the
full value of the Equipment and a specified amount set forth in the lease; and
maintain liability insurance naming the Partnership as an additional insured
with a minimum coverage which the General Partner deems appropriate. In
addition, the Partnership may purchase "umbrella" insurance policies to cover
excess liability and casualty losses, to the extent deemed practicable and
advisable by the General Partner. As of December 31, 2003, all leases that have
been entered into are "triple net leases".

                                                                               5
<PAGE>

         The General Partner has not established any standards for lessees to
whom it will lease Equipment and, as a result, there is not an investment
restriction prohibiting the Partnership from doing business with any lessees.
However, a credit analysis of all potential lessees is undertaken by the General
Partner to determine the lessee's ability to make payments under the proposed
lease. The General Partner may refuse to enter into an agreement with a
potential lessee based on the outcome of the credit analysis.

         The terms and conditions of the Partnership's leases, or Conditional
Sales Contracts, are each determined by negotiation and may impose substantial
obligations upon the Partnership. Where the Partnership assumes maintenance or
service obligations, the General Partner generally causes the Partnership to
enter into separate maintenance or service agreements with manufacturers or
certified maintenance organizations to provide such services. Such agreements
generally require annual or more frequent adjustment of service fees. As of
December 31, 2003, the Partnership has not entered into any such agreements.

     Remarketing fees are paid to the leasing companies from which the
Partnership purchases leases. These are fees that are earned by the leasing
companies when the initial terms of the lease have been met. The General Partner
believes that this strategy adds value since it entices the leasing company to
"stay with the lease" for potential extensions, remarketing or sale of
equipment. This strategy potentially minimizes any conflicts the leasing company
may have with a potential new lease and will potentially assist in maximizing
overall portfolio performance. The remarketing fee is tied into lease
performance thresholds and is factored in the negotiation of the fee.

BORROWING POLICIES

         The General Partner, at its discretion, may cause the Partnership to
incur debt in the maximum aggregate amount of 30% of the aggregate cost of the
Equipment owned, or subject to Conditional Sales Contract, by the Partnership at
the time the debt is incurred. The Partnership incurs only non-recourse debt,
which is secured by Equipment and lease income therefrom. Such leveraging
permits the Partnership to increase the aggregate amount of its depreciable
assets, and, as a result, potentially increases both its lease revenues and its
federal income tax deductions above those levels, which would be achieved
without leveraging. There is no limit on the amount of debt that may be incurred
in connection with the acquisition of any single item of Equipment. Any debt
incurred is fully amortized over the term of the initial lease or Conditional
Sales Contract to which the Equipment securing the debt is subject. The precise
amount borrowed by the Partnership depends on a number of factors, including the
types of Equipment acquired by the Partnership; the creditworthiness of the
lessee; the availability of suitable financing; and prevailing interest rates.
The Partnership is flexible in the degree of leverage it employs, within the
permissible limit. There can be no assurance that credit will be available to
the Partnership in the amount or at the time desired or on terms considered
reasonable by the General Partner. As of December 31, 2003, the aggregate
nonrecourse debt outstanding of $168,000 was 6.4% of the aggregate cost of the
Equipment owned.

         The Partnership has and may continue to purchase some items of
Equipment without leverage. If the Partnership purchases an item of Equipment
without leverage and thereafter suitable financing becomes available, it may
then obtain the financing, secure the financing with the purchased Equipment to
the extent practicable and invest any proceeds from such financing in additional
items of Equipment, or it may distribute some or all of such proceeds to the
Limited Partners. Any such later financing will be on terms consistent with the
terms applicable to borrowings generally. As of December 31, 2003, the
Partnership has not exercised this option.

                                                                               6
<PAGE>

         To date, the General Partner has caused the Partnership to borrow funds
at fixed interest rates and plans to continue borrowing additional funds on the
same basis, to the fullest extent practicable. The Partnership may, from time to
time, borrow funds at rates, which vary with the "prime" or "base" rate,
however, in such a case, if lease revenues were fixed, a rise in the "prime" or
"base" rate would increase borrowing costs and reduce the amount of the
Partnership's income and cash available for distribution. Therefore, the General
Partner is permitted to borrow funds to purchase Equipment at fluctuating rates
only if the lease for such Equipment provides for fluctuating rental payments
calculated on a similar basis.

         Any additional debt incurred by the Partnership must be nonrecourse.
Nonrecourse debt, in the context of the business to be conducted by the
Partnership, means that the lender providing the funds can look for security
only to the Equipment pledged as security and the proceeds derived from leasing
or selling such Equipment. Neither the Partnership nor any Partner (including
the General Partner) would be liable for repayment of any nonrecourse debt.

         Loan agreements may also require that the Partnership maintain certain
reserves or compensating balances and may impose other obligations upon the
Partnership. Moreover, since a significant portion of the Partnership's revenues
from the leasing of Equipment will be reserved for repayment of debt, the use of
financing reduces the cash, which might otherwise be available for distributions
until the debt has been repaid and may reduce the Partnership's Cash Flow over a
substantial portion of the Partnership's operating life. As of December 31,
2003, no such agreements existed.

         The General Partner and any of its Affiliates may, but are not required
to, make loans to the Partnership on a short-term basis. If the General Partner
or any of its Affiliates makes such a short-term loan to the Partnership, the
General Partner of Affiliate may not charge interest at a rate greater that the
interest rate charged by unrelated lenders on comparable loans for the same
purpose in the same locality. In no event is the Partnership required to pay
interest on any such loan at an annual rate greater than three percent over the
"prime rate' from time to time announced by PNC Bank, Philadelphia, Pennsylvania
("PNC Bank"). All payments of principal and interest on any financing provided
by the General Partner or any of its affiliates are due and payable by the
Partnership within 12 months after the date of the loan.

REFINANCING POLICIES

         Subject to the limitations set forth in "Borrowing Policies" above, the
Partnership may refinance its debt from time to time. With respect to a
particular item of Equipment, the General Partner will take into consideration
such factors as the amount of appreciation in value, if any, to be realized, the
possible risks of continued ownership, and the anticipated advantages to be
obtained for the Partnership, as compared to selling such Equipment. As of
December 31, 2003, the Partnership has not refinanced any of its notes payables.
As of December 31, 2002, the Partnership refinanced one of its notes payable.
The note payable, originally set to expire in February 2004, currently will
expire in June 2006. Simultaneous, with the refinancing, the Partnership entered
into a Direct Financing Capital Lease with the lessee for this Equipment.

                                                                               7
<PAGE>

         Refinancing, if achievable, may permit the Partnership to retain an
item of Equipment and at the same time to generate additional funds for
reinvestment in additional Equipment or for distribution to the Limited
Partners.

LIQUIDATION POLICIES

         The General Partner intends to cause the Partnership to begin disposing
of its Equipment in approximately January 2006. Notwithstanding the
Partnership's objective to sell all of its assets and dissolve by December 31,
2006, the General Partner may at any time cause the Partnership to dispose of
all its Equipment and, dissolve the Partnership upon the approval of Limited
Partners holding a Majority in Interest of Units.

         Particular items of Equipment may be sold at any time if, in the
judgment of the General Partner, it is in the best interest of the Partnership
to do so. The determination of whether particular items of Partnership Equipment
should be sold or otherwise disposed of is made by the General Partner after
consideration of all relevant factors (including prevailing general economic
conditions, lessee demand, the General Partner's views of current and future
market conditions, the cash requirements of the Partnership, potential capital
appreciation, cash flow and federal income tax considerations), with a view
toward achieving the principal investment objectives of the Partnership. As
partial payment for Equipment sold, the Partnership may receive purchase money
obligations secured by liens on such Equipment. Subject to the General Partner's
discretion the Partnership may extend beyond December 31, 2006, if deemed
beneficial to the Partnership.

MANAGEMENT OF EQUIPMENT

         Equipment management services for the Partnership's Equipment is
provided by the General Partner and its Affiliates and by persons employed by
the General Partner. Such services will consist of collection of income from the
Equipment, negotiation and review of leases, Conditional Sales Contracts and
sales agreements, releasing and leasing-related services, payment of operating
expenses, periodic physical inspections and market surveys, servicing
indebtedness secured by Equipment, general supervision of lessees to assure that
they are properly utilizing and operating Equipment, providing related services
with respect to Equipment, supervising, monitoring and reviewing services
performed by others in respect to Equipment and preparing monthly Equipment
operating statements and related reports.

COMPETITION

         The equipment leasing industry is highly competitive. The Partnership
competes with leasing companies, equipment manufacturers and their affiliated
financing companies, distributors and entities similar to the Partnership
(including other programs sponsored by the General Partner), some of which have
greater financial resources than the Partnership and more experience in the
equipment leasing business than the General Partner. Other leasing companies and
equipment manufacturers, their affiliated financing companies and distributors
may be in a position to offer equipment to prospective lessees on financial
terms, which are more favorable, that those which the Partnership can offer.
They may also be in a position to offer trade-in privileges, software,
maintenance contracts and other services, which the Partnership may not be able
to offer. Equipment manufacturers and distributors may offer to sell equipment
on terms (such as liberal financing terms and exchange privileges), which will
afford benefits to the purchaser similar to those obtained through leases. As a
result of the advantages, which certain of its competitors may have, the
Partnership may find it necessary to lease its Equipment on a less favorable
basis than certain of its competitors.

         The computer peripheral equipment industry is extremely competitive.
Competitive factors include pricing, technological innovation and methods of
financing. Certain manufacturer-lessors maintain advantages through patent
protection, where applicable, and through a policy that combines service and
hardware with payment accomplished through a single periodic charge.

         The dominant firms in the computer marketplace are Dell, IBM, Hewlett
Packard, Sun Systems and Cisco. Because of the substantial resources and
dominant position of these companies, revolutionary changes with respect to
computer systems, pricing, marketing practices, technological innovation and the
availability of new and attractive financing plans would occur at any time.
Significant action in any of these areas by these firms might materially
adversely affect the partnerships' business or the other manufacturer's with
whom the General Partner might negotiate purchase and other agreements. Any
adverse affect on these manufacturers could be reflected in the overall return
realized by the Partnership on equipment from those manufacturers.

                                                                               8
<PAGE>

INVESTMENTS

         The Partnership, through CCC, participates in the purchase of equipment
subject to associated debt obligations and lease agreements. The purchase price,
list price and monthly rentals presented below are the Partnership's
participation of the total amounts, based on CCC's allocation of the equipment
to the Partnership, and in some instances, other affiliated partnerships.

         Through March 11, 2004, the Partnership has purchased, or has made the
commitment to purchase, the following Equipment:
<TABLE>
<CAPTION>

                                                                                                     MONTHLY    LEASE
             LESSEE                    MFG       EQUIPMENT DESCRIPTION   LIST PRICE    PURCHASE       RENTAL     TERM
                                                                                        PRICE
<S>                                    <C>               <C>                    <C>          <C>      <C>         <C>
Xerox Corp.                            SUN          (32) Workstation       $440,800     $ 277,705     $   286     39
Xerox Corp.                            SUN            (4)SPARC2000          590,840       305,875       1,019     39
Fingerhut Corp.                       SIEMEN            2240-004            722,000       459,592       8,558     48
Chrysler Corp.                         STK            (2) 4490-M30          686,158       490,110      12,001     48
GE Industrial & Power Systems           HP            HP9000/J200           202,680       157,635       4,115     36
Wang Laboratories Inc.                 PYR              NILE 150            937,290       589,287      16,639     36
Chrysler Corp.                         IBM              3745-31A            242,244       184,383       4,203     48
Sprint Communications Co.              STK            (9)9490-M32         1,335,897       703,968      15,501     36
Honda R&D                              SGI              4XR10000            400,220       298,094       7,683     36
Sprint Communications Co.              IBM            (2) 3995-133          421,500       286,536      10,166     24
Equitable Life Assurance Co.           LEX             (80) N240            571,351       497,477      11,501     36
Chrysler Corp.                         STK        Tape Lib/Redwd/Timbl    1,693,479       997,891      22,520     36
Equitable Life Assurance Co.           LEX             (16)OPTRA             74,458        94,098       2,615     36
Kaiser                                 IBM         3745-611A/3746-900     2,149,234     1,191,555      29,786     36
Litton                                 SUN              (1)E3000            251,967       148,492       3,771     36
Sprint Communications Co.              SUN             (2)ES5000            371,640       231,551       7,199     30
Computer Science Corp.                 SGI          144Workstations       2,055,893       822,455      21,031     36
Paine Webber                           IBM            (2)9032-003           932,206       455,473      11,060     36
Charles Schwab                         IBM            (6) 9032-003          495,889       307,983       6,989     36
ADP                                    IBM        (3)3490-A20 (1)-B40       579,850       379,682       5,036     36
Lucent                                 SUN          (1) 3000 Server          70,300        45,892       1,181     36
Lucent                                 SUN          (1) 3500 Server          75,750        49,505       1,274     36
Pitney Bowes                           IBM              (1) 3590            526,390       299,832       5,852     40
Cendant                                SUN              (1)6000             512,640       274,774       6,722     36
Sprint                                 SUN           Upgrade ES5000          21,400        14,491         602     25
Kaiser                                CISCO           (33)Routers            65,835        38,948       1,333     36
Morgan Stanley                         SUN              ENT4000             184,144       122,751       3,018     24
Moore Business                         IBM           (2)3900-DW1/2          515,000       460,490       9,040     43
SMS                                    STK             Tape Drive         1,452,140       576,586      34,140     36
UNUM                                   IBM              Printer             343,010       343,010       6,338     48
Thomson Consumer Electric               HP          Visualize C3600          26,670        17,682         696     24
GE Medical                            CISCO             Routers              88,000        58,465       1,565     36
GE Medical                            CISCO             Routers              59,917        35,570         950     35
GE Medical                            CISCO           (6) Routers            34,650        22,976         617     36
Thomson Consumer Electric           Thermojet          SOP System            14,770         9,794         382     24
McLeod Farms                          COMPAQ            Servers              67,175        56,318       1,685     31
Boeing Satellite Systems               SUN       (10)280R Sparclil 750       53,614        53,614       1,409     36
Kaiser                                 IBM             (1) Server             4,864         4,961         385     36
Capital Technology                   Various            Servers              75,687        75,687       2,069   24-36
Capital Technology                   Various            Servers              68,952        68,952       2,021   25-37
America Online                         SUN              Servers             434,387       283,067       7,720     35
GE Medical                             IBM              Printers             10,979        11,199         295     36
Thomson Consumer Electric              LEX         (2)PL4630 Printers        46,547        47,478       1,271     36
Raytheon                              Compaq             Server             215.215       154,103       6,642     24
ITT Night Vision                       Dell           Workstations           33,782        15,790         983     14
ITT Night Vision                       Dell           Workstations           45,071        29,832       1,320     22
Vatterott Educational                 Intel           Workstations           16,257        14,349         467     30
Keller Group                           Dell           Workstations            4,381         4,553         249     17
GE Medical                             Sun              Servers              12,459        10,000         261     36
XTS Corporation                        Dell           Workstations            6,989         5,000         142     36

</TABLE>


                                                                               9
<PAGE>

RESERVES

         Because the Partnership's leases are on a "triple-net" basis, no
permanent reserve for maintenance and repairs will be established from the
Offering proceeds. However, the General Partner, in its sole discretion, may
retain a portion of the Cash Flow and Net Disposition Proceeds available to the
Partnership for maintenance, repairs and working capital. There are no
limitations on the amount of Cash Flow and Net Disposition Proceeds that may be
retained as reserves. Since no reserve will be established if available Cash
Flow of the Partnership is insufficient to cover the Partnership's operating
expenses and liabilities, it may be necessary for the Partnership to obtain
additional funds by refinancing its Equipment or borrowing.

GENERAL RESTRICTIONS

         Under the Partnership Agreement, the Partnership is not permitted,
among other things, to:

         (a) invest in junior trust deeds unless received in connection with the
sale of an item of Equipment in an aggregate amount that does not exceed 30% of
the assets of the Partnership on the date of the investment;

         (b) invest in or underwrite the securities of other issuers;

         (c) acquire any Equipment for Units;

         (d) issue senior securities (except that the issuance to lenders of
notes or other evidences of indebtedness in connection with the financing or
refinancing of Equipment or the Partnership's business shall not be deemed to be
the issuance of senior securities);

         (e) make loans to any Person, including the General Partner or any of
its Affiliates, except to the extent a Conditional Sales Contract constitutes a
loan;

         (f) sell or lease any Equipment to, lease any Equipment from, or enter
into any sale- leaseback transactions with, the General Partner or any of its
Affiliates; or

         (g) give the General Partner or any of its Affiliates an exclusive
right or employment to sell the Partnership's Equipment.

         The General Partner has also agreed in the Partnership Agreement to use
its best efforts to assure that the Partnership shall not be deemed an
"investment company" as such term is detained in the Investment Company Act of
1940.

         The General Partner and its Affiliates may engage in other activities,
whether or not competitive with the Partnership. The Partnership Agreement
provides, however, that neither the General Partner nor any of its Affiliates
may receive any rebate or "give up" in connection with the Partnership's
activities or participate in reciprocal business arrangements that circumvent
the restrictions in the Partnership Agreement against dealings with Affiliates.

                                                                              10
<PAGE>

EMPLOYEES

         The Partnership has no employees and received administrative and other
services from a related party, CCC, which has 28 employees as of December 31,
2003.

ITEM 2:  PROPERTIES

                           NOT APPLICABLE

ITEM 3:  LEGAL PROCEEDINGS

                           On or about May 8, 2000, a complaint captioned
                           Commonwealth Capital Corp V. Getronics, Inc. was
                           filed by Commonwealth Capital Corp against Getronics,
                           Inc. (formerly known as Wang Laboratories, Inc.) with
                           the Federal District Court of the Eastern District of
                           Pennsylvania, No. 00-CV-2381 on behalf of the
                           Partnership. The complaint alleges that the named
                           defendant has not returned the proper equipment
                           stated in the master lease agreement and is seeking
                           restitution for lost monthly rentals, taxes, attorney
                           fees and costs, plus interest.

                           The defendant filed for a Summary Judgment on
                           February 20, 2001, and the plaintiff has filed an
                           opposition to this Summary Judgment. On September 29,
                           2001, the Federal District Court of the Eastern
                           District of Pennsylvania denied the defendant's
                           request for Summary Judgment. As of March 29, 2002,
                           the pre-trial conference was completed. On February
                           13, 2003, the Federal District Court of the Eastern
                           District of Pennsylvania has assigned a trial date of
                           May 14, 2003. A court date was scheduled for
                           September 8, 2003, and the judge granted a new 30-day
                           discovery period for both parties. A court date was
                           rescheduled for February 9, 2004, but has been
                           postponed again. A new date has not yet been
                           scheduled.

ITEM 4:  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                           NOT APPLICABLE

PART II

ITEM 5:  MARKET FOR THE REGISTRANTS COMMON EQUITY AND

                  RELATED STOCKHOLDER MATTERS

         There is no public market for the Units nor is it anticipated that one
will develop. As of December 31, 2003, there were 737 holders of Units. The
Units are not listed on any exchange or permitted to trade on any
over-the-counter market. In addition, there are substantial restrictions on the
transferability of Units.

GENERAL LIMITATIONS

         Units cannot be transferred without the consent of the General Partner,
which may be withheld in its absolute discretion. The General Partner monitors
transfers of Units in an effort to ensure that all transfers are within certain
safe harbors promulgated by the IRS to furnish guidance regarding publicly
traded partnerships. These safe harbors limit the number of transfers that can
occur in any one year. The General Partner intends to cause the Partnership to
comply with the safe harbor that permits nonexempt transfers and redemptions of
Units of up to five percent of the total outstanding interest in the
Partnership's capital or profits in any one year.

                                                                              11
<PAGE>

REDEMPTION PROVISION

         Upon the conclusion of the 30-month period following the termination of
the Offering, the Partnership may, at the sole discretion of the General
Partner, repurchase a number of the outstanding Units. After such 30 month
period, on a semi-annual basis, the General Partner, at its discretion, will
establish an amount for redemption, generally not to exceed two percent of the
outstanding Units per year, subject to the General Partner's good faith
determination that such redemptions will not (a) cause the Partnership to be
taxed as a corporation under Section 7704 of the Code or (b) impair the capital
or operations of the Partnership. (The Partnership may redeem Units in excess of
the two percent limitation if, in the good faith judgment of the General
Partner, the conditions imposed in the preceding sentence would remain
satisfied.) The redemption price for Units will be 105% of the selling Limited
Partner's Adjusted Capital Contributions attributable to the Units for sale.
Following the determination of the annual redemption amount, redemptions will
occur on a semi-annual basis and all requests for redemption, which must be made
in writing, must be on file as of the Record Date in which the redemption is to
occur. The General Partner will maintain a master list of requests for
redemption with priority being given to Units owned by estates, followed by IRAs
and Qualified Plans. All other requests will be considered in the order
received. Redemption requests made by or on behalf of Limited Partners who are
not affiliated with the General Partner or its Affiliates will be given priority
over those made by Limited Partners who are affiliated with the General Partner
or its Affiliates. All redemption requests will remain in effect until and
unless canceled, in writing, by the requesting Limited Partner(s).

         The Partnership will accept redemption requests beginning 30 months
following the termination of the Offering. There will be no limitations on the
period of time that a redemption request may be pending prior to its being
granted. Limited Partners will not be required to hold their interest in the
Partnership for any specified period prior to their making a redemption request.

         In order to make a redemption request, Limited Partners will be
required to advise the General Partner in writing of such request. Upon receipt
of such notification, the Partnership will provide detailed forms and
instructions to complete the request. For the twelve months ending December 31,
2003, the General Partner has not redeemed any Units. Additionally, no Limited
Partners have requested redemption of their Units.

EXEMPT TRANSFERS

         The following six categories of transfers are exempt transfers for
purposes of calculating the volume limitations imposed by the IRS and will
generally be permitted by the General Partner:

         (1) transfers in which the basis of the Unit in the hands of the
transferee is determined, in whole or in part, by reference to its basis in the
hands of the transferor (for example, Units acquired by corporations in certain
reorganizations, contributions to capital, gifts of Units, Units contributed to
another partnership, and nonliquidating as well as liquidating distributions by
a parent partnership to its partners of interests in a sub partnership);

         (2) transfers at death;

         (3) transfers between members of a family (which include brothers and
sisters, spouse, ancestors, and lineal descendants);

         (4) transfers resulting from the issuance of Units by the Partnership
in exchange for cash, property, or services;

         (5) transfers resulting from distributions from Qualified Plans; and

                                                                              12
<PAGE>

         (6) any transfer by a Limited Partner in one or more transactions
during any 30-day period of Units representing in the aggregate more than five
percent of the total outstanding interests in capital or profits of the
Partnership.

ADDITIONAL RESTRICTIONS ON TRANSFER

         Limited Partners who wish to transfer their Units to a new beneficial
owner are required to pay the Partnership up to $50 for each transfer to cover
the Partnership's cost of processing the transfer application and take such
other actions and execute such other documents as may be reasonably requested by
the General Partner. There is no charge for re-registration of a certificate in
the event of a marriage, divorce, death, or trust so long as the transfer is not
a result of a sale of the Units.

         In addition, the following restrictions apply to each transfer: (i) no
transfer may be made if it would cause 25% or more of the outstanding Units to
be owned by benefit plans; and (ii) no transfer is permitted unless the
transferee obtains such governmental approvals as may reasonably be required by
the General Partner, including without limitation, the written consents of the
Pennsylvania Securities Commissioner and of any other state securities agency or
commission having jurisdiction over the transfer.

ALLOCATION AND DISTRIBUTION BETWEEN THE GENERAL PARTNER AND THE LIMITED PARTNERS

         Cash distributions, if any, are made quarterly on March 31, June 30,
and September 30, and December 31, of each year. Distributions are made 99% to
the Limited Partners and one percent to the General Partner until the Limited
Partners have received an amount equal to their Capital Contributions plus the
Priority Return; thereafter, cash distributions will be made 90% to Limited
Partners and 10% to the General Partner. Distributions made in connection with
the liquidation of the Partnership or a Partner's Units will be made in
accordance with the Partner's positive Capital Account balance as determined
under the Partnership Agreement and Treasury Regulations.

         The Priority Return is calculated on the Limited Partners' Adjusted
Capital Contributions for their Units. The Adjusted Capital Contributions will
initially be equal to the amount paid by the Limited Partners for their Units.
If distributions at any time exceed the Priority Return, the excess will reduce
the Adjusted Capital Contributions, decreasing the base on which the Priority
Return is calculated.

         If the proceeds resulting from the sale of any Equipment are reinvested
in Equipment, sufficient cash will be distributed to the Partners to pay the
additional federal income tax resulting from such sale for a Partner in a 38.6%
federal income tax bracket or, if lower, the maximum federal income tax rate in
effect for individuals for such taxable year.

         Generally, the General Partner is allocated Net Profits equal to its
cash distributions (but not less than one percent of Net Profits) and the
balance is allocated to the Limited Partners. Net Profits arising from
transactions in connection with the termination or liquidation of the
Partnership are allocated in the following order: (1) First, to each Partner in
an amount equal to the negative amount, if any, of his Capital Account; (2)
Second, an amount equal to the excess of the proceeds which would be distributed
to the Partners based on the Operating Distributions to the Partners over the
aggregate Capital Accounts of all the Partners, to the Partners in proportion to
their respective shares of such excess, and (3) Third, with respect to any
remaining Net Profits, to the Partners in the same proportions as if the
distributions were Operating Distributions. Net Losses, if any, are in all cases
allocated 99% to the Limited Partners and one percent to the General Partner.

         Net Profits and Net Losses are computed without taking into account, in
each taxable year of the Partnership, any items of income, gain, loss or
deduction required to be specially allocated pursuant to Section 704(b) of the
Code and the Treasury Regulation promulgated thereunder. No Limited Partner is
required to contribute cash to the capital of the Partnership in order to
restore a closing Capital Account deficit, and the General Partner has only a
limited deficit restoration obligation under the Partnership Agreement.

                                                                              13
<PAGE>

         Quarterly distributions in the following amounts were paid to the
Limited Partners during 2003, 2002 and 2001:

<TABLE>
<CAPTION>

             Quarter Ended                        2003                  2002                2001
            ------------------------------------------------------------------------------------


              <S>                                <C>                  <C>                   <C>
               March 31                   $ ----               $ ----                   $156,205

                June 30                     ----                 ----                    156,205

             September 30                   ----                 ----                      ----

              December 31                   ----                 ----                      ----
                                    -------------------------------------------------------------
                                          $  -0-               $  -0-                   $312,410
                                    =============================================================

</TABLE>

ALLOCATIONS AND DISTRIBUTIONS AMONG THE LIMITED PARTNERS

         Except during the Offering Period, Cash Available for Distribution that
is allocable to the Limited Partners is apportioned among and distributed to
them solely with reference to the number of Units owned by each as of the Record
Date for each such distribution. During the Offering Period, Cash Available for
Distribution which is allocable to the Limited Partners was apportioned among
and distributed to them with reference to both (i) the number of Units owned by
each as of each Record Date and (ii) the number of days since the previous
Record Date (or, in the case of the first Record Date, the commencement of the
Offering Period) that the Limited Partner owned the Units.

         After the Offering Period, Net Profits, Net Losses and Cash Available
for Distribution allocable to the Limited Partners is apportioned among them in
accordance with the number of Units owned by each. A different convention was
utilized during the Offering Period, whereby Net Profits and Net Losses
allocable to Limited Partners were apportioned among them in the ratio which the
product of the number of Units owned by a Limited Partner multiplied by the
number of days in which the Limited Partner owns such Units during the period
bears to the sum of such products for all Limited Partners.

         In addition, where a Limited Partner transfers Units during a taxable
year, the Limited Partner may be allocated Net Profits for a period for which
such Limited Partner does not receive a corresponding cash distribution.

                                                                              14
<PAGE>

ITEM 6:  SELECTED FINANCIAL DATA

         The following table sets forth, in summary form, selected financial
data for the Partnership as of and for each of the five years in the period
ending December 31, 2003. This table is qualified in its entirety by the more
detailed information and financial statements presented elsewhere in this
report, and should be read in conjunction with "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and the financial
statements and related notes thereto included herein.
<TABLE>
<CAPTION>

                                                YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------------------------------------------------------

<S>                                     <C>               <C>                  <C>               <C>                 <C>
Statements of Operations Data:          2003              2002                 2001              2001                1999
-----------------------------------------------------------------------------------------------------------------------------

Lease Income                          $331,958           $405,772            $764,635         $1,790,339          $2,995,506
-----------------------------------------------------------------------------------------------------------------------------

Net (Loss) / Income                   (114,587)          (237,111)            170,529           (205,279)           (478,168)
-----------------------------------------------------------------------------------------------------------------------------

Cash Distributions                         ---              ---               315,490          1,031,324             959,043
-----------------------------------------------------------------------------------------------------------------------------

Net (Loss) / Income Per                   (.18)              (.38)                .27               (.34)               (.77)
Limited Partner Unit
-----------------------------------------------------------------------------------------------------------------------------

Cash Distribution Per Limited
Partner Unit                               ---               ---                  .50               1.62                1.50
-----------------------------------------------------------------------------------------------------------------------------


                                                    AS OF DECEMBER 31,
-----------------------------------------------------------------------------------------------------------------------------

Other Data:                            2003                2002                 2001              2000               1999
-----------------------------------------------------------------------------------------------------------------------------

 Net cash (used in) provided
   by operating activities            ($64,210)           ($2,263)           $256,758           $513,403            $751,814
-----------------------------------------------------------------------------------------------------------------------------

  Net cash provided by (used
   in) investing activities             65,181            (10,329)                678            365,210             422,952
-----------------------------------------------------------------------------------------------------------------------------

  Net cash provided by (used
   in) financing activities                ---             11,948            (320,931)        (1,031,324)           (959,043)
-----------------------------------------------------------------------------------------------------------------------------


                                                      AS OF DECEMBER 31,
-----------------------------------------------------------------------------------------------------------------------------

                                        2003                2002               2001                2001               1999
-----------------------------------------------------------------------------------------------------------------------------

Total Assets                          $684,151           $968,125          $1,108,320           $839,551          $2,858,500
-----------------------------------------------------------------------------------------------------------------------------

Notes Payable                          168,343            444,732             500,585             67,647             716,792
-----------------------------------------------------------------------------------------------------------------------------

Partners' Capital                       86,573            201,160             438,271            583,232           1,819,835
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>

         Net income (loss) per unit is computed based upon net income (loss)
allocated to the Limited Partners and the weighted average number of equivalent
Units outstanding during the year. Cash distribution per Unit is computed based
upon distributions allocated to the Limited Partners and the weighted average
number of equivalent Units outstanding during the year.

                                                                              15
<PAGE>

ITEM 7: MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
        OPERATIONS

CRITICAL ACCOUNTING POLICIES

Financial Reporting Release No. 60, which was recently released by the
Securities and Exchange Commission, requires all companies to include a
discussion of critical accounting policies or methods used in the preparation of
financial statements. Our significant accounting policies are described in Note
1 of the Notes to the Financial Statements. The significant accounting policies
that we believe are the most critical to aid in fully understanding our reported
financial results include the following:

COMPUTER EQUIPMENT

CCC, on behalf of the Partnership and other affiliated partnerships, acquires
computer equipment subject to associated debt obligations and lease agreements
and allocates a participation in the cost, debt and lease revenue to the various
partnerships based on certain risk factors.

REVENUE RECOGNITION

Through December 31, 2003, the Partnership's leasing operations consist
substantially of operating leases and one direct financing lease. Operating
lease revenue is recognized on a monthly basis in accordance with the terms of
the lease agreement. Unearned revenue from direct financing agreements is
amortized to revenue over the lease term.

The Partnership reviews a customer's credit history before extending credit and
establishes a provision for uncollectible accounts receivable based upon the
credit risk of specific customers, historical trends and other information.

LONG-LIVED ASSETS

The Partnership evaluates its long-lived assets when events or circumstances
indicate that the value of the asset may not be recoverable. The Partnership
determines whether impairment exists by estimating the undiscounted cash flows
to be generated by each asset. If the estimated undiscounted cash flows are less
than the carrying value of the asset then impairment exists. The amount of the
impairment is determined based on the difference between the carrying value and
the fair value. Fair value is determined based on estimated discounted cash
flows to be generated by the asset.

Depreciation on computer equipment for financial statement purposes is based on
the straight-line method over estimated useful lives of four years.

REIBURSABLE EXPENSES

Reimbursable expenses, which are charged to the Partnership by CCC in connection
with the administration and operation of the Partnership, are allocated to the
Partnership based upon several factors including, but not limited to, the number
of investors, compliance issues, and the number of existing leases.

LIQUIDITY AND CAPITAL RESOURCES

         For the year ended December 31, 2003, the Partnership used cash flow
from operating activities of $64,000, which includes a loss of $107,000, and
gain from the sale of computer equipment of $51,000, and was reduced by
depreciation and amortization expenses of $255,000. Other noncash activities
included in the determination of the net loss include direct payments of lease
income by lessees to banks of $267,000.


                                                                              16
<PAGE>

         The Partnership's primary sources of capital for the years ended
December 31, 2003, 2002 and 2001 were cash from operations of $257,000 for 2001,
and proceeds from the sale of computer equipment of $70,000, $24,000, and
$230,000 in 2003, 2002 and 2001, respectively. The primary uses of cash for the
years ended December 31, 2003 and 2002 were $64,000 and $2,000, respectively,
used in operations and capital expenditures for new equipment totaling $5,000,
$25,000 and $199,000 for the years ended December 31, 2003, 2002 and 2001,
respectively, and for the payment of distributions to partners approximating
$315,000 for 2001. There were no distributions paid in 2003 and 2002 mainly due
to the litigation with Getronics, declining lease revenues and declining cash
from operations.

         Cash is invested in money market accounts that invest directly in
treasury obligations pending the Partnership's use of such funds to purchase
additional computer equipment, to pay Partnership expenses or to make
distributions to the Partners.

         The Partnership's investment strategy of acquiring computer equipment
and generally leasing it under triple-net leases to operators who generally meet
specified financial standards minimizes the Partnership's operating expenses. As
of December 31, 2003, future minimum rentals on noncancellable operating and
capital leases decreased to $215,000, down from $545,000 and $760,000 in 2002
and 2001, respectively, due to the fact that more lease agreements have expired
than new computer equipment leases acquired in 2002 and 2001. As of December 31,
2003, the Partnership had future minimum rentals on noncancellable operating
leases of $173,000 for the year ended 2004 and $12,000 thereafter. As of
December 31, 2003, the Partnership had future minimum rentals on noncancellable
capital leases of $12,000 for the year ended 2004 and $18,000 thereafter. The
Partnership incurred debt in 2002 in the amount of $204,000, down from $544,000
in 2001. No debt was incurred in 2003. At December 31, 2003, the outstanding
debt was $168,000, with a weighted average interest rate of 6.87% and will be
payable through June 2006. The Partnership intends to continue purchasing
additional computer equipment when future cash becomes available from future
lease rentals and sales proceeds. In addition, the Partnership may incur debt in
purchasing computer equipment in the future.

         CCC, on behalf of the Partnership and other affiliated partnerships,
acquires computer equipment subject to associated debt obligations and lease
agreements and allocates a participation in the cost, debt and lease revenue to
the various partnerships based on certain risk factors. The Partnership's share
of the computer equipment in which they participate at December 31, 2003 and
2002 is approximately $448,000 and $443,000, respectively, which is included in
the Partnership's fixed assets on their balance sheet, and the total cost of the
equipment shared by the Partnership with other partnerships at December 31, 2003
and 2002 was approximately $2,258,000 and $2,210,000, respectively. The
Partnership's share of the outstanding debt associated with this equipment at
December 31, 2003 and 2002 is approximately $96,000 and $233,000, respectively,
which is included in the Partnership's liabilities on the balance sheet, and the
total outstanding debt at December 31, 2003 and 2002 related to the equipment
shared by the Partnership was approximately $537,000 and $1,197,000,
respectively.

         The Partnership, has suffered recurring losses from operations,
declining cash provided by operating activities, has not paid partner
distributions since June 2001, has partners' capital of approximately $85,000 at
December 31, 2003 and CCC filed a lawsuit on the Partnership's behalf, alleging
that the named defendant has not returned the proper leased equipment.

          The lawsuit, which was originally filed in 2001, still has not been
heard by the court due to several postponements by the judge assigned to the
lawsuit. The Partnership has made several attempts to transfer the case to
another judge. The General Partner has decided that if the court does not hear
the lawsuit by June 30, 2004, then the General Partner will seek to transfer the
lawsuit and the related lease receivable to a trust on behalf of the Partnership
and begin the liquidation phase of the Partnership as provided for in the
original Partnership agreement. If the court hears the lawsuit by June 30, 2004,
and if the outcome of the lawsuit is favorable, the General Partner plans to use
the proceeds from the lawsuit to continue current Partnership operations and
purchase additional equipment leases, without paying fees to the General
Partner, with terms of approximately 12-24 months. If the outcome of the lawsuit
is not to the General Partner's satisfaction, then the General Partner plans to
begin the liquidation phase of the Partnership. If the Partnership's cash is
insufficient from operations or if the trust has insufficient cash, the General
Partner and CCC intend to pay the legal expenses associated with the lawsuit.

                                                                              17

<PAGE>

         The General Partner intends to review and reassess the Partnership's
business plan on a quarterly basis.

RESULTS OF OPERATIONS

         For the year ended December 31, 2003, 2002 and 2001, the Partnership
recognized income of $383,000, $443,000, and $954,000, and expenses of $498,000,
$680,000, and $784,000, resulting in a net loss of $115,000 and $237,000 in 2003
and 2002, respectively, and net income of $170,000 in 2001.

            Lease income decreased 18% to $332,000 in 2003, down from $406,000
and $765,000 in 2002 and 2001, respectively, primarily due to the fact that more
lease agreements terminated than new lease agreements entered into since 2001.
As of January 1, 2002, the Partnership stopped recording revenue on its
Getronics lease arrangement. This is due to the fact that the defendant (see
Legal Proceedings in Part I, Item 3) has not returned the proper equipment as
defined in the master lease agreement.

          The Partnership sold computer equipment with a net book value of
$19,000, $6,000, and $44,000 during the years ended December 31, 2003, 2002 and
2001, respectively, for a net gain of $51,000, $18,000 and $185,000 for the
years ended December 31, 2003, 2002 and 2001, respectively.

         Operating expenses, excluding depreciation, consist of accounting,
legal, outside service fees and reimbursement of expenses to CCC for
administration and operation of the Partnership. The operating expenses totaled
approximately $196,000 in 2003, $291,000 in 2002, and $221,000 in 2001.
Consistent with the decline in lease revenues and lease activities during 2003,
there was a decrease in reimbursable expenses with the administration and
operation of the Partnership charged by CCC, a related party, of approximately
$46,000, a decrease in recruiting fees of approximately $10,000, a decrease in
conventions of approximately $4,000, a decrease in due diligence of
approximately $10,000, a decrease in office supplies of approximately $4,000, a
decrease in outside office services of approximately $8,000 and a decrease in
warehouse/storage fees of approximately $4,000.

         The equipment management fee is equal to approximately 5% of the gross
lease revenue attributable to equipment, which is subject to operating and
capital leases. The equipment management fee was $17,000 in 2003, down from
$20,000 in 2002 and $38,000 in 2001, which is consistent with the decrease in
lease income.

         Interest expense decreased to $23,000 in 2003, down from $40,000 in
2002, but up from $11,000 in 2001, as a result of new leases with associated
debt obligations being acquired late in the third and fourth quarters of 2001,
and some of those leases with associated debt obligations having expired during
2003.
         Depreciation and amortization expenses consist of depreciation on
computer equipment, equipment acquisition fees and debt placement fees.
Depreciation and amortization during 2003 decreased to $263,000, down from
$304,000 and $413,000 in 2002 and 2001, respectively, due to the older equipment
becoming fully depreciated and certain acquisition and finance fees being fully
amortized and only a minimal amount of new additions.

         The Partnership has charged bad debt expense of $25,000 and $100,000 as
additional allowances against accounts receivable for the years ending December
31, 2002 and 2001, respectively. There was no bad debt expense recorded for the
year ending December 31, 2003.

         The Partnership identified specific computer equipment and associated
equipment acquisition costs, which were reevaluated due to technological
changes. In 2003, the Partnership determined that the carrying amount of certain
assets was greater than the undiscounted cash flows to be generated by these
assets. The Partnership recorded charges of $8,000 and in the fourth quarter of
2003 to record the assets at their estimated fair value. Such amounts have been
included in depreciation expense in the accompanying financial statements. In
2002 and 2001, the Partnership determined that no impairment had occurred.

                                                                              18
<PAGE>

NET INCOME (LOSS)

         Net income (loss) decreased in 2003 to a net loss of $115,000, down
from a net loss of $237,000 in 2002 and net income of $170,000 in 2001.

         The changes in net income (loss) were attributable to the changes in
revenues and expenses as discussed above.

COMMITMENTS AND CONTINGENCIES

         Contractual Cash Obligations

The following table presents our contractual cash obligations as of December 31,
2003:
<TABLE>
<CAPTION>

                                                                                 Payments due by period

                                             Total                          2004                        2005-2006
                                   ----------------------------------------------------------------------------------------
<S>                                       <C>                             <C>                              <C>
Installment notes payable due 2004:

     Principal                            $140,640                        $140,640                         $----

     Interest                                4,327                           4,327                          ----

Installment notes payable due 2006:

     Principal                              27,703                          10,545                        17,158

     Interest                                2,386                           1,490                           896
                                   ----------------------------------------------------------------------------------------

Total                                     $175,056                        $157,002                       $18,054
                                   ========================================================================================

</TABLE>
                        RECENT ACCOUNTING PRONOUNCEMENTS

                              Interpretation No. 45

In November 2002, the FASB issued Interpretation No. 45, "Guarantor's Accounting
and Disclosure Requirements for Guarantees, including Indirect Guarantees of
Indebtedness of Others" ("Interpretation No. 45"). Interpretation No. 45
elaborates on the existing disclosure requirements for most guarantees,
including loan guarantees such as standby letters of credit. It also clarifies
that at any time a company issues a guarantee, the company must recognize the
initial liability for the fair market value of the obligations it assumes under
the guarantee and must disclose that information in its interim and annual
financial statements. The initial recognition and measurement provisions of
Interpretation No. 45 apply on a prospective basis to guarantees issued or
modified after December 31, 2002. Interpretation No. 45 did not have an effect
on our financial statements.

                                                                              19
<PAGE>

                              Interpretation No. 46

In January 2003, FASB issued Interpretation No. 46, "Consolidation of Variable
Interest Entities" ("Interpretation No. 46"), which clarifies the application of
Accounting Research Bulletin No. 51, "Consolidated Financial Statements," to
certain entities in which equity investors do not have the characteristics of a
controlling financial interest or do not have sufficient equity at risk for the
entity to finance its activities without additional subordinated financial
support from the other parties. Interpretation No. 46 is applicable immediately
for variable interest entities created after January 31, 2003. For variable
interest entities created before January 31, 2003, the provisions of
Interpretation No. 46, the provisions of Interpretation No. 46 have been
deferred to the first quarter of 2004. The adoption of Interpretation No. 46 did
not have an impact on the financial position and results of operations.

                                    SFAS 150

         In May 2003, the FASB issued FASB Statement No. 150, Accounting for
Certain Financial Instruments with Characteristics of both Liabilities and
Equity, which establishes standards on how an issuer classifies and measures
certain financial instruments with characteristics of liabilities and equity. It
requires that an issuer classify a financial instrument that is within its scope
as a liability (or an asset in some circumstances). Many of those instruments
entered into or modified after May 31, 2003 and otherwise shall be effective at
the beginning of the first interim period beginning after June 15, 2003. The
adoption of SFAS 150 did not have an impact on its financial position and
results of operations.

ITEM 7.A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The Partnership believes its exposure to market risk is not material
due to the fixed interest rate of its long-term debt and its associated fixed
revenue streams.

ITEM 8: FINANCIAL STATEMENTS

         See financial statements commencing in part IV Item 14.

ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

                  NONE

ITEM 9A: CONTROLS AND PROCEDURES

         Our management, under the supervision and with the participation of the
principal executive officer and principal financial offer, have evaluated the
effectiveness of our controls and procedures related to our reporting and
disclosure obligations as of December 31, 2003, which is the end of the period
covered by this Annual Report on Form 10-K. Based on that evaluation, the
principal executive officer and principal financial officer have concluded that
our disclosure controls and procedures are sufficient to provide that (a)
material information relating to us, including our consolidated subsidiaries, is
made known to these officers by our and our consolidated subsidiaries other
employees, particularly material information related to the period for which
this periodic report is being prepared; and (b) this information is recorded,
processed, summarized, evaluated and reported, as applicable, within the time
periods specified in the rules and forms promulgated by the Securities and
Exchange Commission.


                                                                              20
<PAGE>

ITEM 10: DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

GENERAL

         The General Partner, a wholly owned subsidiary of Commonwealth of
Delaware, Inc., a Delaware corporation, which is in turn a wholly-owned
subsidiary of CCC, a Pennsylvania corporation, was incorporated in Pennsylvania
on August 26, 1993. The General Partner also acts as the General Partner for
Commonwealth Income and Growth Fund II, Commonwealth Income and Growth Fund III
and Commonwealth Income and Growth Fund IV. The principal business office of the
General Partner is 470 John Young Way, Suite 300, Exton, PA 19341, and its
telephone number is 610-594-9600. The General Partner manages and controls the
affairs of the Partnership and has sole responsibility for all aspects of the
Partnership's operations. The officers of the General Partner devote such time
to the affairs of the Partnership as in the opinion of the General Partner is
necessary to enable it to perform its function as General Partner. The officers
of the General Partner are not required to spend their full time in meeting
their obligations to the Partnership.

         The directors and officers of the General Partner and key employees of
CCC are as follows:

<TABLE>
<CAPTION>

NAME                       TITLE
----                       -----
<S>                         <C>
George S. Springsteen      Chairman of the Board of Directors and President of the General Partner and CCC

Kimberly A. Springsteen    Executive Vice President, Chief Operating Officer and Secretary of the General Partner and CCC

Henry J. Abbott            Senior  Vice  President,  Director  and  Portfolio  Manager  of the  General  Partner  & CCC

Jay Dugan                  Senior Vice President & IT Manager of the General Partner & CCC

Salvatore R. Barila        Vice President and Controller of the General Partner and CCC

Michelle Onuffer           Assistant Vice President and Accounting Manager of the General Partner and CCC

Dorothy A. Ferguson        Assistant Vice President & Compliance Manager of the General Partner & CCC

Karen Tramontano           Assistant Vice President & Marketing Manager of the General Partner & CCC

David Borham               Assistant Vice President & Investor Relations Manager of the General Partner & CCC

</TABLE>

         George S. Springsteen, age 68, is President of both CCC and the General
Partner. Mr. Springsteen is also President of the general partners or
controlling entities of several prior programs sponsored by CCC with objectives
similar to the Partnership's. He has been the sole shareholder and director of
CCC since its formation in 1978. From 1971 to 1978, Mr. Springsteen was involved
in the computer leasing business of Granite Computer Corporation. Mr.
Springsteen served as Vice President of Marketing, in addition to other
capacities, and managed a portfolio of approximately $120,000,000 of IBM
computers and peripherals. In 1978, Granite Computer Corporation sold its
equipment portfolio and left the equipment leasing business. Mr. Springsteen
acquired a portion of Granite's portfolio, client base, employees and corporate
offices in Jenkintown, Pennsylvania. The new company began operations as CCC in
May of 1978. Mr. Springsteen received a Bachelor of Science degree from the
University of Delaware in 1957.

                                                                              21
<PAGE>

         Kimberly A. Springsteen, age 44, is Executive Vice President, Chief
Operating Officer and Secretary of CCC and the General Partner and joined CCC in
1997. She is also the President of Commonwealth Capital Securities Corp. From
1980 to 1997, Ms. Springsteen was employed with Wheat First Butcher Singer, a
broker/dealer headquartered in Richmond, Virginia. While at Wheat First Butcher
Singer, Ms. Springsteen, Senior Vice President, served as Marketing Manager for
the Direct Investments Department, with over $450,000,000 of investments under
management in real estate, equipment leasing and energy-related industries. Ms.
Springsteen holds Series 7, 63 and 39 NASD licenses and is a member of the
Equipment Leasing Association, Investment Partnership Association, and
International Association for Financial Planning.

         Henry J. Abbott, age 53, is Senior Vice President and Portfolio Manager
of CCC and has been employed by CCC since 1998. Mr. Abbot has been active in the
commercial lending industry, working primarily on asset-backed transactions for
more than twenty-seven years. Prior to joining CCC Mr. Abbott was a founding
partner of Westwood Capital LLC, in New York. Prior to that, as Senior Vice
President for IBJ Schroder Leasing Corporation where Mr. Abbott managed a group
specializing in providing operating lease financing programs in the high
technology sector. Mr. Abbott brings extensive knowledge and experience in all
facets of asset-backed financing and has successfully managed $1.5 billion of
secured transactions. Mr. Abbott attended St. John's University. Mr. Abbott is a
member of the Equipment Leasing Association.

         Jay Dugan, age 55, is Senior Vice President and Information Technology
Manager of the General Partner and CCC and has been employed by CCC since 2002.
Mr. Dugan is responsible for computer network and information systems for the
General Partner and its affiliates. Mr. Dugan was a registered securities
representative from 1988 until 1998. During that period, Mr. Dugan founded First
Securities USA, a NASD member firm, and operated that firm through 1998. From
1999 until joining CCC in 2002, Mr. Dugan was an independent due diligence
consultant.

         Salvatore R. Barila, age 33, is Vice President and Controller of the
General Partner and CCC and certain of its subsidiaries where he has been
employed since 2001. From 1992 to 2001, Mr. Barila was employed as Corporate
Accounting Manager of RCG Information Technology, Inc., whereby he was
responsible for the preparation of the monthly financial statements, budgeting
and forecasting for multiple divisions and the consolidated entity. Mr. Barila
received a B.B.A. degree in Accounting from Pace University in 1992. Mr. Barila
is a member of the Equipment Leasing Association.

         Michelle Onuffer, age 32, is Assistant Vice President and Accounting
Manager of the General Partner and CCC and certain of its subsidiaries where she
has been employed since 2004. Prior to CCC, she was employed by Dutch State
Minds as an Accounting Manager, whereby she was responsible for month-end
reporting, monthly financial statements, budgeting, and cash management. Ms.
Onuffer was a registered securities representative from 1995 to 1999. She brings
4 years of securities experience and over 5 years of accounting experience. Ms.
Onuffer has a B.B. in Financial Management from Goldey-Beacon College and an MBA
in Accounting from the University of Phoenix.

         Dorothy A. Ferguson, age 61, is Assistant Vice President of CCC and has
been employed by CCC since 1995. She brought with her over 20 years experience
in commercial banking and finance. Prior to joining Commonwealth, she held
positions as a Banking Officer and Administrative Assistant to the Chairman of a
large Philadelphia based bank, as well as Executive Secretary to the CEO of an
international manufacturing management group.


         Karen Tramontano, age 51, Assistant Vice President & Marketing Manger,
joined Commonwealth in 2000, brining with her over a decade of experience of
international marketing and customer relations. Ms. Tramontano is responsible
for the generation and distribution of all marketing materials for the Manager's
investment programs. Prior to joining Commonwealth, Ms. Tramontano served from
1973 to 1983 as executive liaison to the President of V&V Noordland, Inc., an
international commercial company, and served as an office manager for a small
business in Florida from 1998 to 2000. Ms. Tramontano coordinates Commonwealth's
home office marketing department, which serves our broker dealer community and
registered representatives across the country. Ms. Tramontano attended Suffolk
College in New York, with a Major in Advertising/Promotion.

                                                                              22
<PAGE>

         David Borham, age 26, Assistant Vice President & Marketing Manager,
joined Commonwealth in 2000, bringing with him 2 years of Customer Service
experience. Mr. Borham holds a Series 22 NASD license and is responsible for the
management of investor database maintenance and all investor inquiries and
correspondence. Prior to joining Commonwealth, Mr. Borham served as a Customer
Relations Representative in the food service industry for Dilworth Town Inn from
1996 to 2000. Mr. Borham attended Delaware County Community College.

     The directors and officers of the General Partner are required to spend
only such time on the Partnership's affairs as is necessary in the sole
discretion of the directors of the General Partner for the proper conduct of the
Partnership's business. A substantial amount of time of such directors and
officers is expected to be spent on matters unrelated to the Partnership,
particularly after the Partnership's investments have been selected. Under
certain circumstances, such directors and officers are entitled to
indemnification from the Partnership.

ITEM 11:          EXECUTIVE COMPENSATION

         The following table summarizes the types, amounts and recipients of
compensation to be paid by the Partnership directly or indirectly to the General
Partner and its Affiliates. Some of these fees are paid regardless of the
success or profitability of the Partnership's operations and investments. While
such compensation and fees were established by the General Partner and are not
based on arm's-length negotiations, the General Partner believes that such
compensation and fees are comparable to those that would be charged by an
unaffiliated entity or entities for similar services. The Partnership Agreement
limits the liability of the General Partner and its Affiliates to the
Partnership and the Limited Partners and provides indemnification to the General
Partner and its Affiliates under certain circumstances.

<TABLE>
<CAPTION>

                                                                                      AMOUNT           AMOUNT           AMOUNT
   ENTITY RECEIVING                                                                  INCURRED         INCURRED         INCURRED
     COMPENSATION                 TYPE OF COMPENSATION                              DURING 2003      DURING 2002      DURING 2001

                        OFFERING AND ORGANIZATION STAGE

<S>                      <C>                                                          <C>             <C>              <C>
The General Partner     Organizational  Fee.  An Organization                        $0              $0               $0
                        --------------------
                        Fee equal to three  percent of the first
                        $10,000,000 of Limited Partners' Capital Contributions
                        and two percent of the Limited Partners' Capital
                        Contribution in excess of $10,000,000, as compensation
                        for the organization of the Partnership. It is
                        anticipated that all Organizational and Offering
                        Expenses which include legal, accounting and printing
                        expenses; various registration and filing fees;
                        miscellaneous expenses related to the organization and
                        formation of the Partnership; other costs of
                        registration; and costs incurred in connection with the
                        preparation, printing and distribution of this Report
                        and other sales literature. The General Partner pays all
                        Organizational and Offering Expenses, other than
                        Underwriter's Commissions and a non-accountable expense
                        allowance payable to the Dealer Manager that is equal to
                        the lesser of (i) one percent of the Offering proceeds
                        or (ii) $50,000.
</TABLE>

                                                                              23
<PAGE>

<TABLE>
<CAPTION>

                                  OPERATIONAL AND SALE
                                 OR LIQUIDATION STAGES
<S>                      <C>                                                          <C>             <C>              <C>
The General Partner     Equipment  Acquisition Fee. An Equipment Acquisition         $1,000          $9,000           $30,000
                        Fee of four percent of the Purchase Price of each item
                        of Equipment purchased as compensation for the
                        negotiation of the acquisition of the Equipment and the
                        lease thereof or sale under a Conditional Sales
                        Contract. The fee was paid upon each closing of the
                        Offering with respect to the Equipment purchased by the
                        Partnership with the net proceeds of the Offering
                        available for investment in Equipment. If the
                        Partnership acquires Equipment in an amount exceeding
                        the net proceeds of the Offering available for
                        investment in Equipment, the fee will be paid when such
                        Equipment is acquired.

The General Partner     Reimbursable  Expenses.  The General and its Affiliates      $194,000        $280,000         $175,000
and its Affiliates      are entitled to reimbursement by the Partnership for the
                        cost of goods, supplies or services obtained and used by
                        the General Partner in connection with the
                        administration and operation of the Partnership from
                        third parties unaffiliated with the General Partner. In
                        addition, the General Partner and its affiliates are
                        entitled to reimbursement of certain expenses incurred
                        by the General Partner and its affiliates in connection
                        with the administration and operation of the
                        Partnership. The amounts set forth on this table do not
                        include expenses incurred in the offering of Units.


The General Partner     Debt Placement Fee. As compensation  for arranging Term      $0              $2,000           $5,000
                        Debt to finance the acquisition of Equipment to the
                        Partnership, a fee equal to one percent of such
                        indebtedness; provided, however, that such fee is
                        reduced to the extent the Partnership incurs such fees
                        to third Parties, un affiliated with the General Partner
                        or the lender, with respect to such indebtedness and no
                        such fee is paid with respect to borrowings from the
                        General Partner or its Affiliates.


The General Partner     Equipment  Management Fee. A monthly fee equal to the        $17,000          $20,000          $38,000
                        lesser of (i) the fees which would be charged by an
                        independent third party for similar services for similar
                        equipment or (ii) the sum of (a) two percent of (1) the
                        Gross Lease Revenues attributable to Equipment which is
                        subject to Full Payout Net Leases which contain net
                        lease provisions plus (2) the purchase price paid on
                        Conditional Sales Contracts as received by the
                        Partnership and (b) five percent of the Gross Lease
                        Revenues attributable to Equipment which is subject to
                        Operating Leases.


The General Partner     Re-Lease   Fee. As Compensation for  providing               $0              $0               $0
                        re-leasing services for any Equipment for which the
                        General Partner has, following the expiration of, or
                        default under, the most recent lease of Conditional
                        Sales Contract, arranged a subsequent lease of
                        Conditional Sales Contract for the use of such Equipment
                        to a lessee or other party, other than the current or
                        most recent lessee of other operator of such equipment
                        or its Affiliates ("Re-lease"), the General Partner will
                        receive, on a monthly basis, a Re-lease Fee equal to the
                        lesser of (a) the fees which would be charged by an
                        independent third party of comparable services for
                        comparable equipment or (b) two percent of Gross Lease
                        Revenues derived from such Re-lease.

</TABLE>
                                                                              24
<PAGE>

<TABLE>
<CAPTION>

<S>                      <C>                                                          <C>             <C>              <C>
The General Partner     Equipment  Liquidation Fee. With respect to each item        $2,000          $1,000           $7,000
                        of Equipment sold by the General Partner (other than in
                        connection with a Conditional Sales Contract), a fee
                        equal to the lesser of (i) 50% of the Competitive
                        Equipment Sale Commission or (ii) three percent of the
                        sales price for such Equipment. The payment of such fee
                        is subordinated to the receipt by the Limited Partners
                        of (i) a return of their Capital Contributions and 10%
                        annum cumulative return, compounded daily, on Adjusted
                        Capital Contributions ("Priority Return") and (ii) the
                        Net Disposition Proceeds from such sale in accordance
                        with the Partnership Agreement. Such fee is reduced to
                        the extent any liquidation or resale fees are paid to
                        unaffiliated parties.

The General Partner     Partnership Interest. The General Partner  has a             $0              $0             $3,080
                        present and continuing one percent interest of $1,000 in
                        the Partnership's item of income, gain, loss, deduction,
                        credit, and tax preference. In addition, the General
                        Partner receives one percent of Cash Available for
                        Distribution until the Limited Partners have received
                        distributions of Cash Available for Distribution equal
                        to their Capital Contributions plus the 10% Priority
                        Return and thereafter, the General Partner will receive
                        10% of Cash Available for Distribution.
</TABLE>

ITEM 12: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         NOT APPLICABLE

ITEM 13: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The Partnership is subject to various conflicts of interest arising out
of its relationships with the General Partner and its Affiliates. These
conflicts include the following:

        COMPETITION WITH GENERAL PARTNER AND AFFILIATES: COMPETITION FOR
                               MANAGEMENT'S TIME

         The General Partner and its Affiliate sponsor other investor programs,
which are in potential competition with the Partnership in connection with the
purchase of Equipment as well as opportunities to lease and sell such Equipment.
Competition for Equipment has occurred and is likely to occur in the future. The
General Partner and its Affiliates may also form additional investor programs,
which may be competitive with the Partnership.

         If one or more investor programs and the Partnership are in a position
to acquire the same Equipment, the General Partner will determine which program
will purchase the Equipment based upon the objectives of each and the
suitability of the acquisition in light of those objectives. The General Partner
will generally afford priority to the program or entity that has had funds
available to purchase Equipment for the longest period of time. If one or more
investor programs and the Partnership are in a position to enter into lease with
the same lessee or sell Equipment to the same purchaser, the General Partner
will generally afford priority to the Equipment which has been available for
lease or sale for the longest period of time.

         Certain senior executives of the General Partner and its Affiliates
also serve as officers and directors of the other programs and are required to
apportion their time among these entities. The Partnership is, therefore, in
competition with the other programs for the attention and management time of the
General Partner and Affiliates. The officers and directors of the General
Partner are not required to devote all or substantially all of their time to the
affairs of the Partnership.

                                                                              25
<PAGE>

ACQUISITIONS

         CCC and the General Partner or other Affiliates of the General Partner
may acquire Equipment for the Partnership provided that (i) the Partnership has
insufficient funds at the time the Equipment is acquired, (ii) the acquisition
is in the best interest of the partnership and (iii) no benefit to the General
Partner or its Affiliates arises from the acquisition except for compensation
paid to CCC, the General Partner or such other Affiliate as disclosed in this
Report. CCC, the General Partner or their Affiliates will not hold Equipment for
more than 60 days prior to transfer to the Partnership. If sufficient funds
become available to the Partnership within such 60 day period, such Equipment
may be resold to the Partnership for a price not in excess of the sum of the
cost of the Equipment to such entity and any accountable Acquisition Expenses
payable to third parties which are incurred by such entity and interest on the
Purchase Price from the date of purchase to the date of transfer to the
Partnership. CCC, the General Partner or such other Affiliate will retain any
rent or other payments received for the Equipment, and bear all expenses and
liabilities, other than accountable Acquisition Expenses payable to third
parties with respect to such Equipment, for all periods prior to the acquisition
of the Equipment by the Partnership. Except as described above, there will be no
sales of Equipment to or from any Affiliate of CCC.

         In certain instances, the Partnership may find it necessary, in
connection with the ordering and acquisition of Equipment, to make advances to
manufacturers or vendors with funds borrowed from the General Partner for such
purpose. The Partnership does not borrow money from the General Partner or any
of its Affiliates with a term in excess of twelve months. Interest is paid on
loans or advances (in the form of deposits with manufacturers or vendors of
Equipment or otherwise) from the General Partner of its Affiliates from their
own funds at a rate equal to that which would be charged by third party
financing institutions on comparable loans from the same purpose in the same
geographic area, but in no event in excess of the General Partner's or
Affiliate's own cost of funds. In addition, if the General Partner or its
Affiliates borrow money and loan or advance it on a short-term basis to or on
behalf of the Partnership, the General Partner or such affiliates shall receive
no greater interest rate and financing charges from the Partnership than that
which unrelated lender charge on comparable loans. The Partnership will not
borrow money from the General Partner or any of its affiliates for a term in
excess of twelve months.

         If the General Partner or any of its Affiliates purchases Equipment in
its own name and with its own funds in order to facilitate ultimate purchase by
the Partnership, the purchaser is entitled to receive interest on the funds
expended for such purchase on behalf of the Partnership. Simple interest on any
such temporary purchases is charged on a floating rate basis not in excess of
three percent over the "prime rate" from time to time announced by PNC Bank,
from the date of initial acquisition to the date of repayment by the
Partnership/ownership transfer.

         The Partnership does not invest in equipment Limited Partnerships,
general partnerships or joint ventures, except that (a) the Partnership may
invest in general partnerships or joint ventures with persons other than
equipment Programs formed by the General Partner or its Affiliates, provided
that (i) the Partnership has or acquires a controlling interest in such ventures
or partnerships, (ii) the non-controlling interest is owned by a non-Affiliate,
and (iii) there are no duplicate fees; and (b) the Partnership may invest in
joint venture arrangements with other equipment Programs formed by the General
Partner or its Affiliates if such action is in the best interest of all Programs
and if all the following conditions are met: (i) all the Programs have
substantially identical investment objectives; (ii) there are no duplicate fees;
(iii) the sponsor compensation is substantially identical in each Program; (iv)
the Partnership has a right of first refusal to buy another Program's interest
in a joint venture if the other Program wishes to sell equipment held in the
joint venture; (v) the investment of each Program is on substantially the same
terms and conditions; and (vi) the joint venture is formed either for the
purpose of effecting appropriated diversification for the Programs or for the
purpose of relieving the General Partner or its Affiliates from a commitment
entered into pursuant to certain provisions of the Partnership Agreement.

                                                                              26
<PAGE>

GLOSSARY

The following terms used in this Report shall (unless otherwise expressly
provided herein or unless the context otherwise requires) have the meanings set
forth below.

"Acquisition Expenses" means expenses relating to the prospective selection and
acquisition of or investment in Equipment by the Partnership, whether or not
actually acquired, including, but not limited to, legal fees and expenses,
travel and communication expenses, costs of appraisal, accounting fees and
expenses and other related expenses.

"Acquisition Fees" means the total of all fees and commissions paid by any party
in connection with the initial purchase of Equipment acquired by the
Partnership. Included in the computation of such fees or commissions shall be
the Equipment Acquisition Fee and any commission, selection fee, construction
supervision fee, financing fee, non-recurring management fee or any fee of a
similar nature, however designated.

"Adjusted Capital Contributions" means Capital Contributions of the Limited
Partners reduced by any cash distribution received by the Limited Partners
pursuant to the Partnership Agreement, to the extent such distributions exceed
any unpaid Priority Return as of the date such distributions were made.

"Affiliate" means, when used with reference to a specified Person, (i) any
person, that directly or indirectly through one or more intermediaries controls
or is controlled by or is under common control with the specified Person, (ii)
any Person that is a director or an executive officer of, partner in, or serves
in a similar capacity to, the specified Person, or any Person of which the
specified Person is an executive officer or partner or with respect to which the
specified Person serves in a similar capacity, (iii) any Person owning or
controlling 10% or more of the outstanding voting securities of such specified
Person, or (iv) if such Person is an officer, director or partner, any entity
for which such Person acts in such capacity.

"Capital Account" means the bookkeeping account maintained by the Partnership
for each Partner.

"Capital Contributions" means in the case of the General Partner, the total
amount of money contributed to the Partnership by the General Partner, and in
the case of Limited Partners, $20 for each Unit, or where the context requires,
the total Capital Contributions of all the Partners.

"Capital Leases" are leases under which the Equipment either transfers to the
lessee at the end of the lease term, contains a bargain purchase price option,
the lease term is equal to 75% or more of the estimated economic life of the
Equipment, or the present value at the beginning of the lease term of the
minimum lease payments is equal to or exceeds 90% of the excess of the fair
value of the Equipment.

"Cash Available for Distribution" means Cash Flow plus Net Disposition Proceeds
plus cash funds available for distribution from Partnership reserves, less such
amounts as the General Partner, in accordance with the Partnership Agreement,
causes the Partnership to reinvest in Equipment or interests therein, and less
such amounts as the General Partner, in its sole discretion, determines should
be set aside for the restoration or enhancement of Partnership reserves.

"Cash Flow" for any fiscal period means the sum of (i) cash receipts from
operations, including, but not limited to, rents or revenues arising from the
leasing or operation of the Equipment and interest, if any, earned on funds on
deposit for the Partnership, but not including Net Disposition Proceeds, minus
(ii) all cash expenses and costs incurred and paid in connection with the
ownership, lease, management, use and/or operation of the Equipment, including,
but not limited to, fees for handling and storage; all interest expenses paid
and all repayments of principal regarding borrowed funds; maintenance; repair
costs; insurance premiums; accounting and legal fees and expenses; debt
collection expenses; charges, assessments or levies imposed upon or against the
Equipment; ad valorem, gross receipts and other property taxes levied against
the Equipment; and all costs of repurchasing Units in accordance with the
Partnership Agreement; but not including depreciation or amortization of fees or
capital expenditures, or provisions for future expenditures, including, without
limitation, Organizational and Offering Expenses.

                                                                              27
<PAGE>

"Closing Date" means May 11, 1995.

"Code" means the Internal Revenue Code of 1986, as amended, and as may be
amended from tine to time by future federal tax statutes.

"Competitive Equipment Sale Commission" means that brokerage fee paid for
services rendered in connection with the purchase or sale of Equipment, which is
reasonable, customary, and competitive in light of the size, type, and location
of the Equipment.

"Conditional Sales Contract" means an agreement to sell Equipment to a buyer in
which the seller reserves title to, and retains a security interest in, the
Equipment until the Purchase Price of the Equipment is paid.

"Effective Date" means December 17, 1993, the date on which the Partnership's
Registration Statement on Form S-1 was declared effective by the United States
Securities and Exchange Commission.

"Equipment" means each item of and all of the computer peripheral and other
similar capital equipment purchased, owned, operated, and/or leased by the
Partnership or in which the Partnership has acquired a direct or indirect
interest, together with all appliances, parts, instruments, accessories,
furnishings, or other equipment included therein and all substitutions,
renewals, or replacements of, and all additions, improvements, and accessions
to, any and all thereof.

"Full Payout Net Lease" means an initial Net Lease of the Equipment under which
the non-cancelable rental payments due (and which can be calculated at the
commencement of the Net Lease) during the initial noncancelable fixed term (not
including any renewal or extension period of the lease or other contract for the
use of the Equipment) are at least sufficient to recover the Purchase Price of
the Equipment.

"General Partner" means Commonwealth Income & Growth Fund, Inc. and any
additional, substitute or successor general partner of the Partnership.

"Gross Lease Revenues" means Partnership gross receipts from leasing or other
operation of the Equipment, except that, to the extent the Partnership has
leased the Equipment from an unaffiliated party, it shall mean such receipts
less any lease expense.

"Initial Closing" means March 14, 1994, the date after the Minimum Subscription
Amount was received on which funds to acquire Units were released from the
Escrow Account and distributed to the Partnership for the acquisition of Units
by Limited Partners.

"IRS" means the Internal Revenue Service.

"Limited Partner" means a person who acquires Units and who is admitted to the
Partnership as a limited partner in accordance with the terms of the Partnership
Agreement.

"Majority in Interest" means, with respect to the Partnership, Limited Partners
holding more than 50% of the outstanding Units held by all Limited Partners at
the Record Date for any vote or consent of the Limited Partners.

"Minimum Subscription Amount" means an aggregate of $2,500,000 in Subscriptions.

                                                                              28
<PAGE>

"Net Dispositions Proceeds" means the net proceeds realized by the Partnership
from the refinancing, sale or other disposition of Equipment, including
insurance proceeds or lessee indemnity payments arising from the loss or
destruction of Equipment, less such amounts as are used to satisfy Partnership
liabilities.

"Net Lease" means a lease or other contract under which the owner provides
equipment to a lessee or other operator in return for a payment, and the lessee
assumes all obligations and pays for the operation, repair, maintenance and
insuring of the equipment.

"Net Profits" or "Net Losses" shall be computed in accordance with Section
703(a) of the Code (including all items of income, gain, loss or deduction
required to be stated separately pursuant to Section 703(a) (1) of the Code) for
each taxable year of the Partnership or shorter period prior to an interim
closing of the Partnership's books with the following adjustments: (I) any
income of the Partnership that is exempt from federal income tax and not
otherwise taken into account in computing Net Profits and Net Loss pursuant to
this definition shall be added to such taxable income or shall reduce such
taxable loss; (ii) any expenditure of the Partnership described in Code Section
705(a) (2) (B) or treated as Code Section 705(a) (2) (B) expenditures pursuant
to Treasury Regulations section 1.704-1(b) (2) (iv) (i) and not otherwise taken
into account in computing Net Profits and Net Losses pursuant to this definition
shall be subtracted from such taxable income or loss; (iii) items of income,
gain, loss and deduction specially allocated pursuant to Section 7.3 of the
Partnership Agreement shall not be included in the computation of Net Profits or
Net Loss; and if property is reflected on the books of the Partnership at a book
value that differs from the adjusted tax basis of the property in accordance
with Treasury Regulation Section 1.704-1(b) (2) (iv) (d) or (f), depreciation,
amortization, and gain or loss with respect to such property shall be determined
by reference to such book value in a manner consistent with Treasury Regulation
Section 1.704-1(b) (2) (iv) (g). The terms "Net Profit" or "Net Losses" shall
include the Partnership's distributive share of the profit or loss of any
partnership or joint venture in which it is a partner or joint venturer.

"Offering" means the initial public offering of Units in the Partnership.

"Offering Period" means the period commencing the Effective Date and ending the
last day of the calendar month in which the Closing Date occurs.

"Operating Distributions" means the quarterly distributions made to the Partners
pursuant to Article 8 of the Partnership Agreement.

"Operating Lease" means a lease or other contractual arrangement under which an
unaffiliated party agrees to pay the Partnership, directly or indirectly, for
the use of the Equipment, and which is not a Full Payout Net Lease.

"Organizational and Offering Expenses" means the expenses incurred in connection
with the organization of the Partnership and in preparation of the Offering,
including Underwriting Commissions, listing fees and advertising expenses
specifically incurred in connection with the distribution of the Units.

"Partner(s)" means any one or more of the General Partner and the Limited
Partners.

"Partnership" means Commonwealth Income & Growth Fund I, a Pennsylvania limited
partnership.

"Partnership Agreement" means that Limited Partnership Agreement of Commonwealth
Income & Growth Fund I by and among the General Partner and the Limited
Partners, pursuant to which the Partnership is governed.

"Person" means an individual, partnership, limited liability company, joint
venture, corporation, trust, estate or other entity.

                                                                              29
<PAGE>

"Priority Return" means an amount equal to a return at a rate of 10% per annum,
compounded daily, on the Adjusted Capital Contribution for all outstanding
Units, which amount shall begin accruing at the end of the calendar quarter in
which such Units are sold by the Partnership.

"Proceeds" means proceeds from the sale of the Units.

"Program" means a limited or general partnership, joint venture, unincorporated
association or similar organization, other than a corporation formed and
operated for the primary purpose of investment in and the operation of or gain
from an interest in Equipment.

"Purchase Price" means, with respect to any Equipment, an amount equal to the
sum of (i) the invoice cost of such Equipment or any other such amount paid to
the seller, (ii) any closing, delivery and installation charges associated
therewith not included in such invoice cost and paid by or on behalf of the
Partnership, (iii) the cost of any capitalized modifications or upgrades paid by
on or behalf of the Partnership in connection with its purchase of the
Equipment, and (iv) solely for purposes of the definition of Full Payout Net
Lease, the amount of the Equipment Acquisition Fee and any other Acquisition
Fees.

"Retained Proceeds" means Cash Available for Distribution, which instead of
being distributed to the Partners is retained by the Partnership for the purpose
of acquiring or investing in Equipment.

"Term Debt" means debt of the Partnership with a term in excess of twelve
months, incurred with respect to acquiring or investing in Equipment, or
refinancing non-Term Debt, but not debt incurred with respect to refinancing
existing Partnership Term Debt.

"Unit" means a Limited Partnership interest in the Partnership.

PART IV

ITEM 14: EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 10-K

(a) (1)  Financial Statements

         Commonwealth Income & Growth Fund I

         Report of Independent Certified Public Accountant

         Balance Sheets as of December 31, 2003 and 2002

         Statements of Operations for each of the three years ended December 31,
         2003, 2002 and 2001

         Statements of Partners' Capital for each of the three years ended
         December 31, 2003, 2002 and 2001

         Statements of Cash Flows for each of the three years ended December 31,
         2003, 2002 and 2001

         Notes to Financial Statements

(a) (2) Schedules.

         Schedules are omitted because they are not applicable, not required, or
because the required information is included in the financial statements and
notes thereto.

                                                                              30
<PAGE>

(a) (3) Exhibits.

         * 3.1    Certificate of Limited Partnership

         * 3.2    Agreement of Limited Partnership

         27       Financial Data Schedule

         *        Incorporated by reference from the Partnership's Registration
                  Statement on Form S-1 (Registration No. 333-26933)

(b) Reports on Form 8-K

(c) Exhibits.

SIGNATURES

         Pursuant to the requirements of Section 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its behalf March 30, 2004 by the undersigned thereunto duly authorized.




                                COMMONWEALTH INCOME & GROWTH FUND I
                                      By:  COMMONWEALTH INCOME &
                                           GROWTH FUND, INC., General Partner

                                By:   /s/ George S. Springsteen
                                      --------------------------------
                                      George S. Springsteen, President

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated on March 30, 2004.

SIGNATURE                                            CAPACITY
---------                                            --------

/s/ GEORGE S. SPRINGSTEEN           Chairman, President and Sole Director of
-------------------------           Commonwealth Income & Growth Fund, Inc.
George S. Springsteen


/s/ KIMBERLY A. SPRINGSTEEN         Executive Vice President, Chief Operating
---------------------------         Officer and Secretary
Kimberly A. Springsteen




<PAGE>




                                                             Commonwealth Income
                                                                 & Growth Fund I








                                    Years Ended December 31, 2003, 2002 and 2001






<PAGE>




                                                             Commonwealth Income
                                                                 & Growth Fund I







                                                            Financial Statements
                                    Years Ended December 31, 2003, 2002 and 2001



<PAGE>



                                             Commonwealth Income & Growth Fund I





                                                                        Contents
--------------------------------------------------------------------------------




             Report of Independent Certified Public Accountants                3

             Financial statements
                 Balance sheets                                              4-5
                 Statements of operations                                      6
                 Statements of partners' capital                               7
                 Statements of cash flows                                    8-9

             Notes to financial statements                                 10-24





                                                                               2
<PAGE>




Report of Independent Certified Public Accountants

The Partners
Commonwealth Income & Growth Fund I
Exton, Pennsylvania

We have audited the accompanying balance sheets of Commonwealth Income & Growth
Fund I as of December 31, 2003 and 2002, and the related statements of
operations, partners' capital, and cash flows for each of the three years in the
period ended December 31, 2003. These financial statements are the
responsibility of the Partnership's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audits 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.

As described in Notes 2 and 9, Commonwealth Capital Corp, on behalf of the
Partnership, has initiated a lawsuit against a lessee. If the court does not
hear the lawsuit by June 30, 2004, the Partnership will seek to transfer the
lawsuit and the related lease receivable to a trust created on behalf of the
Partnership's partners and then begin liquidating the Partnership's remaining
net assets.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Commonwealth Income & Growth
Fund I at December 31, 2003 and 2002, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 2003, in
conformity with accounting principles generally accepted in the United States.


                                                           /s/ BDO Seidman, LLP

Philadelphia, Pennsylvania
March 12, 2004



                                                                               3
<PAGE>
================================================================================


<TABLE>
<CAPTION>

<S>                                                                            <C>                 <C>
December 31,                                                                    2003                2002
-----------------------------------------------------------------------------------------------------------

Assets

Cash and cash equivalents                                                   $       1,409    $        438
Lease income receivable, net of reserves of $299,578 for 2003, and
     $314,164 for 2002                                                            250,764         250,141
Net investment in direct financing lease                                           22,585          31,620
Other receivables and deposits                                                        200             200
------------------------------------------------------------------------------------------------------------

                                                                                  274,958         282,399
------------------------------------------------------------------------------------------------------------

Computer equipment, at cost                                                     2,610,749       2,669,518
Accumulated depreciation                                                       (2,210,289)     (2,009,051)
------------------------------------------------------------------------------------------------------------

                                                                                  400,460         660,467
------------------------------------------------------------------------------------------------------------

Equipment acquisition costs and deferred expenses, net of
     accumulated amortization of $34,127 and $21,099, respectively                  8,733          25,259

------------------------------------------------------------------------------------------------------------

Total assets                                                                $     684,151    $    968,125
============================================================================================================

</TABLE>


                                                                               4

<PAGE>


                                             Commonwealth Income & Growth Fund I


                                                                  Balance Sheets
================================================================================
<TABLE>
<CAPTION>

December 31,                                                                  2003           2002
-------------------------------------------------------------------------------------------------------
<S>                                                                         <C>           <C>
Liabilities and Partners' Capital

Liabilities
     Accounts payable                                                       $    2,097    $    5,184
     Accounts payable, General Partner                                         261,756       153,113
     Accounts payable, Commonwealth Capital Corp.                               21,220        17,641
     Accounts payable, affiliated limited partnerships                         124,393       126,526
     Unearned lease income                                                      19,769        19,769
     Notes payable                                                             168,343       444,732
--------------------------------------------------------------------------------------------------------

Total liabilities                                                              597,578       766,965
--------------------------------------------------------------------------------------------------------

Partners' capital
     General Partner                                                             1,000         1,000
     Limited partners                                                           85,573       200,160
-------------------------------------------------------------------------------------------------------

Total partners' capital                                                         86,573       201,160
-------------------------------------------------------------------------------------------------------


Total liabilities and partners' capital                                     $  684,151    $  968,125
=======================================================================================================
</TABLE>

                                 See accompanying notes to financial statements.



                                                                               5
<PAGE>


                                             Commonwealth Income & Growth Fund I


                                                        Statements of Operations

================================================================================
<TABLE>
<CAPTION>



Year ended December 31,                                          2003            2002          2001
-------------------------------------------------------------------------------------------------------
<S>                                                            <C>           <C>             <C>
Income
     Lease                                                     $ 331,958     $  405,772      $ 764,635
     Interest and other                                               21         19,334          4,156
     Gain on sale of computer equipment                           51,374         17,628        185,549
-------------------------------------------------------------------------------------------------------

Total income                                                     383,353        442,734        954,340
-------------------------------------------------------------------------------------------------------

Expenses
     Operating, excluding depreciation                           195,617        290,736        221,147
     Equipment management fee, General Partner                    16,598         20,289         38,232
     Interest                                                     22,999         39,803         11,121
     Depreciation                                                291,000        287,151        402,199
     Amortization of equipment acquisition costs, and
         deferred expenses                                        16,726         17,301         11,281
     Provision for uncollectible accounts receivable                  --         24,565         99,831
-------------------------------------------------------------------------------------------------------

Total expenses                                                   497,940        679,845        783,811
-------------------------------------------------------------------------------------------------------

Net (loss) income                                              $ 114,587)    $ (237,111)     $ 170,529
=======================================================================================================

Net (loss) income per equivalent limited partnership unit      $    (.18)    $     (.38)     $     .27



Weighted average number of equivalent
     limited partnership units outstanding during the year
                                                                 631,124        631,124        631,124
=======================================================================================================
</TABLE>

                                 See accompanying notes to financial statements.



                                                                               6
<PAGE>


                                             Commonwealth Income & Growth Fund I


                                                 Statements of Partners' Capital

================================================================================
<TABLE>
<CAPTION>

                                          General     Limited
                                          Partner     Partner    General        Limited
                                           Units       Units     Partner       Partners         Total
-------------------------------------------------------------------------------------------------------

<S>                                        <C>      <C>       <C>          <C>            <C>
Balance, December 31, 2000                  50       631,358   $   1,000    $   582,232    $   583,232

Net income                                  --            --       3,080        167,449        170,529
Adjustment                                  --          (234)         --             --             --
Distributions                               --            --      (3,080)      (312,410)      (315,490)
-------------------------------------------------------------------------------------------------------

Balance, December 31, 2001                  50       631,124       1,000        437,271        438,271

Net (loss)                                  --            --          --       (237,111)      (237,111)
-------------------------------------------------------------------------------------------------------

Balance, December 31, 2002                  50       631,124       1,000        200,160        201,160

Net (loss)                                  --            --          --       (114,587)      (114,587)
-------------------------------------------------------------------------------------------------------

Balance, December 31, 2003                  50       631,124   $   1,000    $    85,573    $    86,573
=======================================================================================================
</TABLE>

                                 See accompanying notes to financial statements.



                                                                               7
<PAGE>


                                             Commonwealth Income & Growth Fund I


                                                        Statements of Cash Flows

================================================================================

<TABLE>
<CAPTION>

Year ended December 31,                                                2003             2002            2001
----------------------------------------------------------------------------------------------------------------
<S>                                                               <C>              <C>               <C>
Cash flows from operating activities
     Net (loss) income                                            $  (114,587)     $  (237,111)      $  170,529

     Adjustments to reconcile net (loss) income to net
         cash (used in) provided by operating activities
              Depreciation and amortization                           262,726          304,452          413,480
              (Gain) on sale of computer
                  equipment                                           (51,374)         (17,628)        (185,549)
              Other noncash activities included in
                  determination of net (loss) income                 (267,354)        (273,464)        (111,180)
              Changes in assets and liabilities
                  (Increase) decrease in assets
                      Lease income receivable                            (623)          50,815            6,590
                      Accounts receivable,
                           Commonwealth Capital Corp.                      --               --          (17,929)
                  (Decrease) increase in liabilities
                      Accounts payable                                 (3,087)         (24,829)         (44,342)
                      Accounts payable, General
                           Partner                                    108,643          123,189           24,807
                      Accounts payable,
                           Commonwealth Capital Corp.                   3,579           35,545               --
                      Accounts payable,
                           affiliated limited partnerships             (2,133)          20,640              215
                      Unearned lease income                                --           16,128              137
----------------------------------------------------------------------------------------------------------------

Net cash (used in) provided by operating activities                   (64,210)          (2,263)         256,758
----------------------------------------------------------------------------------------------------------------
</TABLE>


                                                                               8


<PAGE>


                                             Commonwealth Income & Growth Fund I


                                                        Statements of Cash Flows

================================================================================
<TABLE>
<CAPTION>

Year ended December 31,                                                  2003             2002             2001
-------------------------------------------------------------------------------------------------------------------
<S>                                                                <C>              <C>             <C>
Cash flows from investing activities
     Capital expenditures                                          $   (5,000)      $  (25,000)     $  (199,304)
     Net proceeds from sale of computer
         equipment                                                     70,381           23,816          229,719
     Equipment acquisition fees to the General
         Partner                                                         (200)          (9,145)         (29,737)
-------------------------------------------------------------------------------------------------------------------

Net cash provided by (used in) investing activities                    65,181          (10,329)             678
-------------------------------------------------------------------------------------------------------------------

Cash flows from financing activities
     Proceeds from notes payable                                           --           13,984               --
     Distributions to partners                                             --               --         (315,490)
     Debt placement fee to the General
         Partner                                                           --           (2,036)          (5,441)
-------------------------------------------------------------------------------------------------------------------

Net cash provided by (used in) financing activities                        --           11,948         (320,931)
-------------------------------------------------------------------------------------------------------------------

Net increase (decrease) in cash and cash equivalents
                                                                          971             (644)         (63,495)

Cash and cash equivalents at beginning of year                            438            1,082           64,577
-------------------------------------------------------------------------------------------------------------------

Cash and cash equivalents at end of year                           $    1,409       $      438      $     1,082
===================================================================================================================
</TABLE>

                                 See accompanying notes to financial statements.


                                                                               9
<PAGE>


                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================




1.      Business               Commonwealth Income & Growth Fund I (the
                               "Partnership") is a limited partnership organized
                               in the Commonwealth of Pennsylvania to acquire,
                               own and lease various types of computer
                               peripheral equipment and other similar capital
                               equipment, which will be leased primarily to U.S.
                               corporations and institutions. Commonwealth
                               Capital Corp ("CCC"), on behalf of the
                               Partnership and other affiliated partnerships,
                               acquires computer equipment subject to associated
                               debt obligations and lease agreements and
                               allocates a participation in the cost, debt and
                               lease revenue to the various partnerships based
                               on certain risk factors. The Partnership's
                               General Partner is Commonwealth Income & Growth
                               Fund, Inc. (the "General Partner"), a
                               Pennsylvania corporation which is an indirect
                               wholly owned subsidiary of Commonwealth Capital
                               Corp. Approximately ten to twelve years after the
                               commencement of operations, the Partnership
                               intends to sell or otherwise dispose of all of
                               its computer equipment, make final distributions
                               to partners, and to dissolve. Unless sooner
                               terminated, the Partnership will continue until
                               approximately December 31, 2006.

                               Allocations of income and distributions of cash
                               are based on the Partnership's Limited
                               Partnership Agreement (the "Agreement"). The
                               various allocations under the Agreement prevent
                               any limited partner's capital account from being
                               reduced below zero and ensure the capital
                               accounts reflect the anticipated sharing ratios
                               of cash distributions, as defined in the
                               Agreement. During 2003 and 2002, the Partnership
                               did not make any distributions to the limited
                               partners. During 2001, the Partnership
                               distributed to the limited partners $312,410. The
                               2001 distributions were at an annual rate of 2.4%
                               of the limited partners' original contributed
                               capital. Distributions during 2001 reflect an
                               annual return of capital in the amount of
                               approximately $0.50 per limited partnership unit,
                               for units that were outstanding for the entire
                               year.

2.      Business Plan          The Partnership, has suffered recurring losses
                               from operations, declining cash provided by
                               operating activities, has not paid partner
                               distributions since June 2001, has a partners'
                               capital of approximately $85,000 at December 31,
                               2003 and CCC filed a lawsuit on the Partnership's
                               behalf (see Note 9), alleging that the named
                               defendant has not returned the proper leased
                               equipment.

                                                                              10
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                                        The lawsuit, which was originally filed
                               in 2001, still has not been heard by the court
                               due to several postponements by the judge
                               assigned to the lawsuit. The Partnership has made
                               several attempts to transfer the case to another
                               judge. The General Partner has decided that if
                               the court does not hear the lawsuit by June 30,
                               2004, then the General Partner will seek to
                               transfer the lawsuit and the related lease
                               receivable to a trust on behalf of the
                               Partnership and begin the liquidation phase of
                               the Partnership as provided for in the original
                               Partnership agreement. If the court hears the
                               lawsuit by June 30, 2004, and if the outcome of
                               the lawsuit is favorable, the General Partner
                               plans to use the proceeds from the lawsuit to
                               continue current Partnership operations and
                               purchase additional equipment leases, without
                               paying fees to the General Partner, with terms of
                               approximately 12-24 months. If the outcome of the
                               lawsuit is not to the General Partner's
                               satisfaction, then the General Partner plans to
                               begin the liquidation phase of the Partnership.
                               If the Partnership's cash is insufficient from
                               operations or if the trust has insufficient cash,
                               the General Partner and CCC intend to pay the
                               legal expenses associated with the lawsuit.

                               The General Partner intends to review and
                               reassess the Partnership's business plan on a
                               quarterly basis.

3.      Summary of             Revenue Recognition
        Significant
        Accounting             Through December 31, 2003, the Partnership's
        Policies               leasing operations consist substantially of
                               operating leases and one direct financing lease.
                               Operating lease revenue is recognized on a
                               monthly basis in accordance with the terms of the
                               lease agreement. Unearned revenue from direct
                               financing agreements is amortized to revenue over
                               the lease term.

                               The Partnership reviews a customer's credit
                               history before extending credit and establishes a
                               provision for uncollectible accounts receivable
                               based upon the credit risk of specific customers,
                               historical trends and other information.


                                                                              11

<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                               Use of Estimates

                               The preparation of financial statements in
                               conformity with generally accepted accounting
                               principles requires management to make estimates
                               and assumptions that affect the reported amounts
                               of assets and liabilities and disclosure of
                               contingent assets and liabilities at the date of
                               the financial statements and the reported amounts
                               of revenues and expenses during the reporting
                               period. Actual results could differ from those
                               estimates.

                               Long-Lived Assets

                               The Partnership evaluates its long-lived assets
                               when events or circumstances indicate that the
                               value of the asset may not be recoverable. The
                               Partnership determines whether an impairment
                               exists by estimating the undiscounted cash flows
                               to be generated by each asset, including cash
                               flows from base revenues and proceeds from the
                               sale of equipment. If the estimated undiscounted
                               cash flows are less than the carrying value of
                               the asset then an impairment exists. The amount
                               of the impairment is determined based on the
                               difference between the carrying value and the
                               fair value. Fair value is determined based on
                               estimated discounted cash flows to be generated
                               by the asset. In 2003, the Partnership determined
                               that the carrying amount of certain assets was
                               greater than the undiscounted cash flows to be
                               generated by these assets. The Partnership
                               recorded charges of $8,000 and in the fourth
                               quarter of 2003 to record the assets at their
                               estimated fair value. Such amounts have been
                               included in depreciation expense in the
                               accompanying financial statements. In 2002 and
                               2001, the Partnership determined that no
                               impairment had occurred.

                               Depreciation on computer equipment for financial
                               statement purposes is based on the straight-line
                               method over estimated useful lives of four years.

                               Intangible Assets

                               Equipment acquisition costs and deferred expenses
                               are amortized on a straight-line basis over two-
                               to-four year lives. Unamortized acquisition fees
                               and deferred expenses are charged to amortization
                               expense when the associated leased equipment is
                               sold.



                                                                              12
<PAGE>


                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                               Cash and Cash Equivalents

                               The Partnership considers all highly liquid
                               investments with a maturity of three months or
                               less to be cash equivalents. Cash equivalents
                               have been invested in a money market fund
                               investing directly in Treasury obligations.

                               Income Taxes

                               The Partnership is not subject to federal income
                               taxes; instead, any taxable income (loss) is
                               passed through to the partners and included on
                               their respective income tax returns.

                               Taxable income differs from financial statement
                               net income as a result of reporting certain
                               income and expense items for tax purposes in
                               periods other than those used for financial
                               statement purposes, principally relating to
                               depreciation, amortization, and lease income.

                               Offering Costs

                               Offering costs were payments for selling
                               commissions, dealer manager fees, professional
                               fees and other offering expenses relating to the
                               syndication. Selling commissions were 7% of the
                               partners' contributed capital and dealer manager
                               fees were 2% of the partners' contributed
                               capital. These costs have been deducted from
                               partnership capital in the accompanying financial
                               statements.

                               Net Income (Loss) Per Equivalent Limited
                               Partnership Unit

                               The net income (loss) per equivalent limited
                               partnership unit is computed based upon net
                               income (loss) allocated to the limited partners
                               and the weighted average number of equivalent
                               limited partner units outstanding during the
                               year.


                                                                              13
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                               Reimbursable Expenses

                               Reimbursable expenses, which are charged to the
                               Partnership by CCC in connection with the
                               administration and operation of the Partnership,
                               are allocated to the Partnership based upon
                               several factors including, but not limited to,
                               the number of investors, compliance issues, and
                               the number of existing leases.

                               Recent Accounting Pronouncements

                                            Interpretation No. 45

                               In November 2002, the FASB issued Interpretation
                               No. 45, "Guarantor's Accounting and Disclosure
                               Requirements for Guarantees, including Indirect
                               Guarantees of Indebtedness of Others"
                               ("Interpretation No. 45"). Interpretation No. 45
                               elaborates on the existing disclosure
                               requirements for most guarantees, including loan
                               guarantees such as standby letters of credit. It
                               also clarifies that at any time a company issues
                               a guarantee, the company must recognize the
                               initial liability for the fair market value of
                               the obligations it assumes under the guarantee
                               and must disclose that information in its interim
                               and annual financial statements. The initial
                               recognition and measurement provisions of
                               Interpretation No. 45 apply on a prospective
                               basis to guarantees issued or modified after
                               December 31, 2002. Interpretation No. 45 did not
                               have an effect on our financial statements.

                                            Interpretation No. 46

                               In January 2003, FASB issued Interpretation No.
                               46, "Consolidation of Variable Interest Entities"
                               ("Interpretation No. 46"), which clarifies the
                               application of Accounting Research Bulletin No.
                               51, "Consolidated Financial Statements," to
                               certain entities in which equity investors do not
                               have the characteristics of a controlling
                               financial interest or do not have sufficient
                               equity at risk for the entity to finance its
                               activities without additional subordinated
                               financial support from the other parties.
                               Interpretation No. 46 is applicable immediately
                               for variable interest entities created after
                               January 31, 2003. For variable interest entities
                               created before January 31, 2003, the provisions
                               of Interpretation No. 46, the provisions of
                               Interpretation No. 46 have been deferred to the
                               first quarter of 2004. The adoption of
                               Interpretation No. 46 did not have an impact on
                               the financial position and results of operations.

                                                                              14
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                                                   SFAS 150

                               In May 2003, the FASB issued FASB Statement No.
                               150, Accounting for Certain Financial Instruments
                               with Characteristics of both Liabilities and
                               Equity, which establishes standards on how an
                               issuer classifies and measures certain financial
                               instruments with characteristics of liabilities
                               and equity. It requires that an issuer classify a
                               financial instrument that is within its scope as
                               a liability (or an asset in some circumstances).
                               Many of those instruments entered into or
                               modified after May 31, 2003 and otherwise shall
                               be effective at the beginning of the first
                               interim period beginning after June 15, 2003. The
                               adoption of SFAS 150 did not have an impact on
                               its financial position and results of operations.

4.      Net Investment in      The following lists the components of the net
        Direct Financing       investment in a direct financing lease as of
        Lease                  December 31, 2003 and 2002:

<TABLE>
<CAPTION>
                               <S>                                                    <C>              <C>

                               December 31,                                              2003         2002
                               --------------------------------------------------------------------------------
                               Minimum lease payments receivable                      $ 30,090     $ 42,126
                               Less: Unearned Revenue                                    7,505       10,506
                               --------------------------------------------------------------------------------
                               Net investment in direct financing lease               $ 22,585     $ 31,620
                               ================================================================================

</TABLE>


                                                                              15
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                               The following is a schedule of future minimum
                               rentals on the noncancellable direct financing
                               lease at December 31, 2003:


                               Year ending December 31,

                                                                       Amount
                                                                       ------
                                   2004                               $12,036

                                   2005                                12,036

                                   2006                                 6,018

                                                                      $30,090





                                                                              16
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

5.      Computer               The Partnership is the lessor of equipment under
        Equipment              operating leases with periods ranging from 24 to
                               48 months. In general, associated costs such as
                               repairs and maintenance, insurance and property
                               taxes are paid by the lessee.

                               The Partnership's share of the computer equipment
                               in which they participate at December 31, 2003
                               and 2002 is approximately $448,000 and $443,000,
                               respectively, which is included in the
                               Partnership's fixed assets on their balance
                               sheet, and the total cost of the equipment shared
                               by the Partnership with other partnerships at
                               December 31, 2003 and 2002 was approximately
                               $2,258,000 and $2,210,000, respectively. The
                               Partnership's share of the outstanding debt
                               associated with this equipment at December 31,
                               2003 and 2002 is approximately $96,000 and
                               $233,000, respectively, which is included in the
                               Partnership's liabilities on the balance sheet,
                               and the total outstanding debt at December 31,
                               2003 and 2002 related to the equipment shared by
                               the Partnership was approximately $537,000 and
                               $1,197,000, respectively.

                               The following is a schedule of future minimum
                               rentals on noncancelable operating leases at
                               December 31, 2003:
<TABLE>
<CAPTION>
                               Year ending December 31,                                          Amount
                               --------------------------------------------------------------------------

                                     <S>                                                           <C>
                                   2004                                                       $  173,000
                                   2005                                                            9,000
                                   2006                                                            3,000
                               --------------------------------------------------------------------------

                                                                                              $  185,000
                               ==========================================================================
</TABLE>
                               Lease income from two lessees, each exceeding 10%
                               of total lease income, approximated 52% of lease
                               income for the year ended December 31, 2003.
                               Lease income from two lessees, exceeding 10% of
                               lease revenue, aggregated 41% of lease income for
                               the year ended December 31, 2002. Lease income
                               from one lessee, exceeding 10% of lease revenue,
                               aggregated 21% of lease income for the year ended
                               December 31, 2001.

                                                                              17
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                               As of December 31, 2003, one different lessee
                               comprised approximately 99% of the Partnership's
                               accounts receivable (see Note 9).

6.      Related Party          Reimbursable Expenses
        Transactions
                               The General Partner and its affiliates are
                               entitled to reimbursement by the Partnership for
                               the cost of supplies and services obtained and
                               used by the General Partner in connection with
                               the administration and operation of the
                               Partnership from third parties unaffiliated with
                               the General Partner. In addition, the General
                               Partner and its affiliates are entitled to
                               reimbursement for certain expenses incurred by
                               the General Partner and its affiliates in
                               connection with the administration and operation
                               of the Partnership. During 2003, 2002 and 2001,
                               the Partnership recorded $194,000, $280,000 and
                               $175,000, respectively, for reimbursement of
                               expenses to the General Partner.

                               Equipment Acquisition Fee

                               The General Partner is entitled to be paid an
                               equipment acquisition fee of 4% of the purchase
                               price of each item of equipment purchased as
                               compensation for the negotiation of the
                               acquisition of the equipment and lease thereof or
                               sale under a conditional sales contract. During
                               2003, 2002 and 2001, equipment acquisition fees
                               of approximately $1,000, $9,000 and $30,000,
                               respectively, were earned by the General Partner.

                               Debt Placement Fee

                               As compensation for arranging term debt to
                               finance the acquisition of equipment by the
                               Partnership, the General Partner is paid a fee
                               equal to 1% of such indebtedness; provided,
                               however, that such fee shall be reduced to the
                               extent the Partnership incurs such fees to third
                               parties, unaffiliated with the General Partner or
                               the lender, with respect to such indebtedness and
                               no such fee will be paid with respect to
                               borrowings from the General Partner or its
                               affiliates. No debt placement fees were earned by
                               the General Partner in 2003. During 2002 and
                               2001, debt placement fees of approximately $2,000
                               and $5,000, respectively, were earned by the
                               General Partner.

                                                                              18
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                               Equipment Management Fee

                               The General Partner is entitled to be paid a
                               monthly fee equal to the lesser of (i) the fees
                               which would be charged by an independent third
                               party for similar services for similar equipment
                               or (ii) the sum of (a) two percent of (1) the
                               gross lease revenues attributable to equipment
                               which is subject to full payout net leases which
                               contain net lease provisions plus (2) the
                               purchase price paid on conditional sales
                               contracts as received by the Partnership and (b)
                               5% of the gross lease revenues attributable to
                               equipment which is subject to operating and
                               capital leases. During 2003, 2002 and 2001,
                               equipment management fees of approximately
                               $17,000, $20,000 and $38,000, respectively, were
                               earned by the General Partner as determined
                               pursuant to section (ii) above.

                               Release Fee

                               As compensation for providing releasing services
                               for any equipment for which the General Partner
                               has, following the expiration of, or default
                               under, the most recent lease or conditional sales
                               contract, arranged a subsequent lease or
                               conditional sales contract for the use of such
                               equipment to a lessee or other party, other than
                               the current or most recent lessee or other
                               operator of such equipment or its affiliates
                               ("Release"), the General Partner shall receive,
                               on a monthly basis, a Release Fee equal to the
                               lesser of (a) the fees which would be charged by
                               an independent third party for comparable
                               services for comparable equipment or (b) two
                               percent of gross lease revenues derived from such
                               Release. There were no such fees earned by the
                               General Partner in 2003, 2002 and 2001.



                                                                              19
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

                               Equipment Liquidation Fee

                               With respect to each item of equipment sold by
                               the General Partner (other than in connection
                               with a conditional sales contract), a fee equal
                               to the lesser of (i) 50% of the competitive
                               equipment sale commission or (ii) three percent
                               of the sales price for such equipment is payable
                               to the General Partner. The payment of such fee
                               is subordinated to the receipt by the limited
                               partners of the net disposition proceeds from
                               such sale in accordance with the Partnership
                               Agreement. Such fee will be reduced to the extent
                               any liquidation or resale fees are paid to
                               unaffiliated parties. During 2003, 2002 and 2001,
                               equipment liquidation fees of approximately
                               $2,000, $1,000 and $7,000, respectively, were
                               earned by the General Partner.

7. Notes Payable               Notes payable consisted of the following:

<TABLE>
<CAPTION>

                               December 31,                                             2003             2002
                               --------------------------------------------------------------------------------
                               <S>                                                       <C>             <C>
                               Installment notes payable to banks; interest
                               ranging from 7.50% to 9.50%; were due in monthly
                               installments ranging from $182 to $1,320 including
                               interest with final payments due from January 2003
                               through November 2003.                                $      --        $  20,977

                               Installment notes payable to banks; interest
                               ranging from 6.25% to 9.25%; due in monthly
                               installments ranging from $138 to $7,720 including
                               interest with final payments due from January 2004
                               through December 2004.                                  140,640          386,168

                               Installment note payable to a bank; interest at
                               6.5%; due in monthly installments of $1,003
                               including interest through June 2006.                    27,703           37,587
                               --------------------------------------------------------------------------------

                                                                                     $ 168,343        $ 444,732
                               ================================================================================

                               These notes are secured by specific computer
                               equipment and are nonrecourse liabilities of the
                               Partnership. Aggregate maturities of notes
                               payable for each of the years subsequent to
                               December 31, 2003 are as follows:

                               Year ending December 31,                                                Amount
                               --------------------------------------------------------------------------------

                                 2004                                                                 $ 151,185
                                 2005                                                                    11,252
                                 2006                                                                     5,906
                               --------------------------------------------------------------------------------

                                                                                                      $ 168,343
                               ================================================================================


</TABLE>


                                                                              20
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================


8.      Supplemental           Other noncash activities  included in the
        Cash Flow              determination of net loss (income) are as
        Information            follows:

<TABLE>
<CAPTION>


<S>                                                         <C>            <C>            <C>
Year ended December 31,                                     2003           2002           2001
--------------------------------------------------------------------------------------------------

Lease income, net of interest expense on
     notes payable realized as a result of direct
     payment of principal by lessee to bank             $   267,354    $   273,464    $   109,615

Lease income paid to original lessor in lieu
     of cash payment for computer equipment acquired
                                                                 --             --          1,565
--------------------------------------------------------------------------------------------------

     Total adjustment to net (loss) income from
     other noncash activities                           $   267,354    $   273,464    $   111,180
==================================================================================================

                                   No interest or principal on notes payable was
                                   paid by the Partnership because direct
                                   payment was made by lessee to the bank in
                                   lieu of collection of lease income and
                                   payment of interest and principal by the
                                   Partnership.

                           Non-cash investing and financing activities include
                           the following:

Year ended December 31,                                     2003          2002           2001
--------------------------------------------------------------------------------------------------

Debt assumed in connection with purchase
     of computer equipment                                $      --   $    204,000    $   544,000
--------------------------------------------------------------------------------------------------

Net book value of equipment converted to direct
     financing leases                                     $      --   $     38,916    $        --
--------------------------------------------------------------------------------------------------

Notes payable refinanced                                  $      --   $     30,953    $        --
--------------------------------------------------------------------------------------------------
</TABLE>

                                                                              21
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================


9.      Litigation             The Partnership, through CCC, has initiated a
                               lawsuit against a customer for the non-return of
                               leased equipment. Management believes that the
                               Partnership will prevail in this matter and that
                               the outcome of this uncertainty is not expected
                               to have a material adverse impact to the
                               financial statements of the Partnership. The
                               Partnership has approximately $250,000 of
                               unreserved accounts receivable relating to this
                               matter. The complaint alleges that the named
                               defendant has not returned the proper equipment
                               stated in the master lease agreement and is
                               seeking restitution for lost monthly rentals,
                               taxes, attorney fees and costs, plus interest.
                               The lawsuit had been scheduled for February 9,
                               2004, but that has been postponed. A new date has
                               not yet been scheduled for the lawsuit.



                                                                              22
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================


10.     Reconciliation of Net
        (Loss) Income
        Reported for
        Financial Reporting
        Purposes to Taxable
        (Loss) Income on the
        Federal Partnership
        Return
<TABLE>
<CAPTION>

Year ended December 31,                                         2003         2002         2001
---------------------------------------------------------------------------------------------------
<S>                                                             <C>         <C>           <C>
Net (loss) income for financial reporting
     purposes                                                $ 114,587)  $ (237,111)   $  170,529
     Adjustments

         Gain (loss) on sale of computer equipment              27,245       (9,911)     (311,306)
         Depreciation                                           64,017     (117,233)       13,439
         Amortization                                           13,937       14,289         9,728
         Bad debt expense                                      (14,587)      14,587       203,649
         Unearned lease income                                 (27,665)      36,620          (138)
         Other                                                  17,473     (117,943)      (57,478)

---------------------------------------------------------------------------------------------------
Taxable (loss) income on the Federal
     Partnership return                                      $ (34,167)  $(416,702)  $   28,423
===================================================================================================
</TABLE>

                               The "Adjustments - Other" includes financial
                               statement adjustments reflected in the tax
                               return in the subsequent year.

                               Adjustment for gain (loss) on sale of
                               equipment is due to longer useful lives for
                               tax reporting purposes.



                                                                              23
<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================


11.     Quarterly Results      Summarized quarterly financial data for the years
        of Operation           ended December 31, 2003 and 2002 is as follows:
        (Unaudited)

<TABLE>
<CAPTION>

                                                               Quarter ended
                                            -----------------------------------------------------
                                            March 31      June 30     September 30    December 31
-------------------------------------------------------------------------------------------------
2003
<S>                                        <C>           <C>          <C>             <C>
Revenues
     Lease and other                       $   88,281    $  83,494    $  80,818       $  79,386
     Gain (loss) on sale of computer
        equipment                               5,640        3,267       (6,421)         48,888
-------------------------------------------------------------------------------------------------

Total revenues                                 93,921       86,761       74,397         128,274

Costs and expenses                            144,016      144,950      106,124          95,350
-------------------------------------------------------------------------------------------------

Net (loss) income                          $  (50,095)   $ (58,189)   $ (31,727)         32,924
=================================================================================================

(Loss) income per limited
     partner unit                          $     (.08)   $    (.09)   $    (.05)      $     .05
=================================================================================================

</TABLE>


                                                                              24

<PAGE>

                                             Commonwealth Income & Growth Fund I


                                                   Notes to Financial Statements

================================================================================

<TABLE>
<CAPTION>

                                                                Quarter ended
                                             ----------------------------------------------------
                                             March 31      June 30     September 30   December 31
-------------------------------------------------------------------------------------------------
2002
<S>                                        <C>           <C>             <C>           <C>
Revenues
     Lease and other                       $   108,075   $  110,462      $   96,821    $  109,748
     Gain (loss) on sale of computer
       equipment                                 6,041       11,685              --           (98
-------------------------------------------------------------------------------------------------

Total revenues                                 114,116      122,147          96,821       109,650

Costs and expenses                             155,992      165,636         193,903       164,314
-------------------------------------------------------------------------------------------------

Net (loss)                                 $   (41,876)  $ (43,489)      $  (97,082)  $  (54,664)
=================================================================================================

(Loss) per limited
     partner unit                          $      (.07)  $    (.07)      $     (.15)  $     (.09)
=================================================================================================
</TABLE>

                                   The cumulative gain or loss on sale of
                                   computer equipment is included in revenues or
                                   costs as appropriate.


                                                                              25