UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549
                                    FORM 10-K

(Mark One)

[x]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934

                   For the fiscal year ended December 31, 1997

                                       OR

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

                        For the transition period from to


                         Commission file number 0-20016

                             CNL INCOME FUND X, LTD.
             (Exact name of registrant as specified in its charter)

                    Florida                            59-3004139
        (State or other jurisdiction of   (I.R.S. Employer Identification No.)
        incorporation or organization)

                              400 East South Street
                             Orlando, Florida 32801
          (Address of principal executive offices, including zip code)

       Registrant's telephone number, including area code: (407) 422-1574

               Securities registered pursuant to Section 12(b) of
                                    the Act:

                 Title of each class:      Name of exchange on which registered:
                         None                         Not Applicable

               Securities registered pursuant to Section 12(g) of
                                    the Act:

              Units of limited partnership interest ($10 per Unit)
                                (Title of class)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934 during the preceding 12 months (or such shorter  period that the registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days: Yes X No

         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of Regulation S-K is not contained  herein,  and will not be contained,
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. [x]

         Aggregate market value of the voting stock held by nonaffiliates of the
registrant:   The  registrant   registered  an  offering  of  units  of  limited
partnership  interest  (the  "Units") on Form S-11 under the  Securities  Act of
1933, as amended. Since no established market for such Units exists, there is no
market value for such Units. Each Unit was originally sold at $10 per Unit.

                      DOCUMENTS INCORPORATED BY REFERENCE:
                                      None


<PAGE>



                                     PART I


Item 1.  Business

         CNL Income Fund X, Ltd. (the  "Registrant" or the  "Partnership")  is a
limited  partnership  which was  organized  pursuant to the laws of the State of
Florida on April 16, 1990. The general partners of the Partnership are Robert A.
Bourne,  James M. Seneff, Jr. and CNL Realty Corporation,  a Florida corporation
(the  "General  Partners").  Beginning  on September  9, 1991,  the  Partnership
offered  for  sale up to  $40,000,000  of  limited  partnership  interests  (the
"Units") (4,000,000 Units at $10 per Unit) pursuant to a registration  statement
on Form S-11 under the Securities Act of 1933, as amended,  effective  March 20,
1991.  The  offering  terminated  on March 18,  1992,  at which date the maximum
offering  proceeds of  $40,000,000  had been  received  from  investors who were
admitted to the Partnership as limited partners (the "Limited Partners").

         The  Partnership  was organized to acquire both newly  constructed  and
existing  restaurant  properties,  as well as properties upon which  restaurants
were to be  constructed  (the  "Properties"),  which  are  leased  primarily  to
operators of national and regional fast-food and family-style  restaurant chains
(the "Restaurant Chains").  Net proceeds to the Partnership from its offering of
Units,  after  deduction  of  organizational  and  offering  expenses,  totalled
$35,200,000, and were used to acquire 47 Properties, including interests in nine
Properties  owned by joint  ventures in which the  Partnership is a co-venturer,
and to establish a working capital reserve for Partnership purposes.  During the
year ended  December  31,  1995,  the  Partnership  sold its Property in Denver,
Colorado, and reinvested the majority of the net sales proceeds in a Shoney's in
Fort Myers  Beach,  Florida.  During  the year  ended  December  31,  1996,  the
Partnership  reinvested  the remaining net sales  proceeds from the 1995 sale of
the  Property  in  Denver,  Colorado,  in a Golden  Corral  Property  located in
Clinton,   North  Carolina,   with   affiliates  of  the  General   Partners  as
tenants-in-common. During the year ended December 31, 1997, the Partnership sold
its  Property in Fremont,  California,  and  reinvested  the majority of the net
sales  proceeds in a Boston  Market in Homewood,  Alabama.  In addition,  during
1997,  the  Partnership  used  approximately  $130,400 that had been  previously
reserved for working capital purposes, to invest in a Chevy's Fresh Mex Property
located  in  Miami,   Florida,  with  affiliates  of  the  General  Partners  as
tenants-in-common.  As a result of the above  transactions,  as of December  31,
1997, the Partnership  owned 49 Properties,  including nine Properties  owned by
joint  ventures in which the  Partnership  is a co-venturer  and two  Properties
owned with affiliates as tenants-in-common. During January 1998, the Partnership
sold its  Property  in  Sacramento,  California,  to the tenant  and  intends to
reinvest  the net sales  proceeds in an  additional  Property.  The  Partnership
leases the Properties on a triple-net basis with the lessees responsible for all
repairs and maintenance, property taxes, insurance and utilities.

         The  Partnership  will hold its Properties  until the General  Partners
determine that the sale or other  disposition of the Properties is  advantageous
in view of the Partnership's investment objectives.  In deciding whether to sell
Properties, the General Partners will consider factors such as potential capital
appreciation,  net cash flow and  federal  income  tax  considerations.  Certain
lessees also have been granted options to purchase Properties,  generally at the
Property's  then fair market  value after a specified  portion of the lease term
has elapsed.  In general,  the General Partners plan to seek the sale of some of
the  Properties  commencing  seven  to 12 years  after  their  acquisition.  The
Partnership  has no  obligation  to sell all or any portion of a Property at any
particular  time,  except as may be required  under  property  or joint  venture
purchase options granted to certain lessees.

Leases

         Although there are variations in the specific terms of the leases,  the
following  is  a  summarized   description  of  the  general  structure  of  the
Partnership's  leases.  Generally,  the  leases of the  Properties  owned by the
Partnership  and the joint  ventures in which the  Partnership is a co-venturer,
provide for initial  terms  ranging  from 14 to 20 years (the  average  being 18
years) and expire between 2006 and 2016.  All leases are on a triple-net  basis,
with the lessee  responsible  for all repairs and  maintenance,  property taxes,
insurance and utilities.  The leases of the Properties  provide for minimum base
annual  rental  payments   (payable  in  monthly   installments)   ranging  from
approximately  $26,200 to  $198,500.  All of the leases  provide for  percentage
rent, based on sales in excess of a specified amount.

                                        1

<PAGE>



In addition,  a majority of the leases  provide  that,  commencing  in specified
lease years  (ranging from the second to the sixth lease year),  the annual base
rent required under the terms of the lease will increase.

         Generally,  the  leases  of the  Properties  provide  for  two to  five
five-year  renewal  options  subject  to the same  terms and  conditions  as the
initial  lease.  Certain  lessees  also have been  granted  options to  purchase
Properties at the Property's then fair market value after a specified portion of
the lease  term has  elapsed.  Under the terms of  certain  leases,  the  option
purchase  price  may equal  the  Partnership's  original  cost to  purchase  the
Property (including  acquisition  costs),  plus a specified  percentage from the
date of the lease or a specified percentage of the Partnership's purchase price,
if that amount is greater than the Property's  fair market value at the time the
purchase option is exercised.

         The leases also  generally  provide that, in the event the  Partnership
wishes to sell the Property  subject to that lease,  the Partnership  first must
offer the  lessee  the right to  purchase  the  Property  on the same  terms and
conditions,  and for the same  price,  as any offer  which the  Partnership  has
received for the sale of the Property.

         In December  1997,  the lease  relating to the Perkins  Property in Ft.
Pierce,  Florida,  was amended to provide for reduced base rents  effective  May
1997 through  December 31, 1998,  with rent deferrals  totalling  $144,633 being
payable by the tenant at the time that the Property is leased to another tenant,
the date the Property is sold or upon termination of the lease, whichever occurs
first.

Major Tenants

         During  1997,  three  lessees (or group of  affiliated  lessees) of the
Partnership and its consolidated joint venture,  (i) Golden Corral  Corporation,
(ii)  Foodmaker,  Inc. and (iii) Flagstar  Enterprises,  Inc. and Denny's,  Inc.
(which are affiliated  entities  under common  control of Flagstar  Corporation)
(hereinafter  referred to as Flagstar  Corporation),  each contributed more than
ten percent of the  Partnership's  total rental income  (including rental income
from the Partnership's consolidated joint venture and the Partnership's share of
rental income from eight Properties owned by  unconsolidated  joint ventures and
two Properties owned with affiliates as  tenants-in-common).  As of December 31,
1997,  Golden Corral  Corporation  was the lessee under leases  relating to four
restaurants,  Foodmaker,  Inc.  was the  lessee  under  leases  relating  to six
restaurants  and Flagstar  Corporation  was the lessee under leases  relating to
nine  restaurants.  It is anticipated  that based on the minimum rental payments
required by the leases,  these three lessees (or groups of  affiliated  lessees)
each will  continue to  contribute  more than ten  percent of the  Partnership's
total rental income in 1998 and subsequent  years. In addition,  five Restaurant
Chains, Golden Corral Family Steakhouse Restaurants ("Golden Corral"), Hardee's,
Burger King,  Shoney's  and Jack in the Box,  each  accounted  for more than ten
percent of the  Partnership's  total rental income during 1997 (including rental
income from the Partnership's  consolidated  joint venture and the Partnership's
share of rental  income  from eight  Properties  owned by  unconsolidated  joint
ventures and two  Properties  owned with  affiliates as  tenants-in-common).  In
subsequent  years, it is anticipated that these five Restaurant Chains each will
continue to account for more than ten percent of the Partnership's  total rental
income to which the  Partnership is entitled under the terms of the leases.  Any
failure of these  lessees  or  Restaurant  Chains  could  materially  affect the
Partnership's  income.  No single  tenant or group of  affiliated  tenants lease
Properties with an aggregate  carrying  value,  excluding  acquisition  fees and
certain acquisition expenses, in excess of 20 percent of the total assets of the
Partnership.

Joint Venture Arrangements

         The Partnership has entered into a joint venture  arrangement,  Allegan
Real Estate Joint Venture,  with an unaffiliated entity to purchase and hold one
Property.  In addition,  the  Partnership  has entered into three separate joint
venture arrangements,  CNL Restaurant Investments III, Ashland Joint Venture and
Williston Real Estate Joint Venture, with affiliates of the General Partners, to
purchase and hold eight Properties.

         The joint  venture  arrangements  provide for the  Partnership  and its
joint venture  partners to share in all costs and benefits  associated  with the
joint ventures in accordance with their respective  percentage  interests in the
joint ventures.  The Partnership and its joint venture partners are also jointly
and severally  liable for all debts,  obligations  and other  liabilities of the
joint ventures.


                                        2

<PAGE>



         CNL  Restaurant  Investments  III's joint  venture  agreement  does not
provide a fixed term, but continues in existence  until  terminated by either of
the joint  venturers.  Ashland Joint Venture has an initial term of 30 years and
Allegan Real Estate Joint Venture and  Williston  Real Estate Joint Venture each
have an initial term of 20 years and,  after the expiration of the initial term,
each of the three joint ventures continues in existence from year to year unless
terminated  at the  option  of any of the  joint  venturers  or by an  event  of
dissolution.  Events  of  dissolution  include  the  bankruptcy,  insolvency  or
termination  of any  joint  venturer,  sale of the  Property  owned by the joint
venture and mutual  agreement of the Partnership and its joint venture  partners
to dissolve the joint venture.

         The  Partnership  has  management  control of Allegan Real Estate Joint
Venture and shares  management  control  equally with  affiliates of the General
Partners for CNL Restaurant Investments III, Williston Real Estate Joint Venture
and Ashland Joint Venture. The joint venture agreements restrict each venturer's
ability to sell,  transfer or assign its joint  venture  interest  without first
offering it for sale to its joint venture  partners,  either upon such terms and
conditions  as to which the  venturers  may agree or, in the event the venturers
cannot agree,  on the same terms and  conditions as any offer from a third party
to purchase such joint venture interest.

         Net cash  flow  from  operations  of CNL  Restaurant  Investments  III,
Allegan Real Estate Joint  Venture,  Ashland Joint  Venture and  Williston  Real
Estate Joint Venture is distributed 50 percent,  88.26%,  10.51% and 41 percent,
respectively,  to the  Partnership and the balance is distributed to each of the
other joint venture  partners in  accordance  with their  respective  percentage
interest in the joint  venture.  Any  liquidation  proceeds,  after paying joint
venture debts and liabilities and funding  reserves for contingent  liabilities,
will be distributed  first to the joint venture  partners with positive  capital
account  balances in proportion to such balances until such balances equal zero,
and thereafter in proportion to each joint venture partner's percentage interest
in the joint venture.

         In addition to the above joint venture agreements, in January 1996, the
Partnership  entered  into an  agreement  to hold a Golden  Corral  Property  as
tenants-in-common  with  affiliates  of  the  General  Partners.  The  agreement
provides  for the  Partnership  and the  affiliates  to share in the profits and
losses of the Property in proportion to each co-venturer's  percentage interest.
The Partnership owns a 13.37% interest in this Property.

         In  addition,  in  December  1997,  the  Partnership  entered  into  an
agreement  to hold a  Chevy's  Fresh  Mex  Property  as  tenants-in-common  with
affiliates of the General Partners.  The agreement  provides for the Partnership
and the  affiliates  to share in the  profits  and  losses  of the  Property  in
proportion to each  co-venturer's  percentage  interest.  The Partnership owns a
6.69% interest in this Property.

Certain Management Services

         CNL Income Fund  Advisors,  Inc., an affiliate of the General  Partners
provided  certain  services  relating to management of the  Partnership  and its
Properties  pursuant to a  management  agreement  with the  Partnership  through
September 30, 1995.  Under this  agreement,  CNL Income Fund Advisors,  Inc. was
responsible for collecting  rental  payments,  inspecting the Properties and the
tenants'  books and records,  assisting the  Partnership in responding to tenant
inquiries and notices and providing  information  to the  Partnership  about the
status of the leases and the  Properties.  CNL Income Fund  Advisors,  Inc. also
assisted the General Partners in negotiating the leases. For these services, the
Partnership  had agreed to pay CNL Income Fund  Advisors,  Inc. an annual fee of
one percent of the sum of gross operating  revenues from Properties wholly owned
by the Partnership plus the  Partnership's  allocable share of gross revenues of
joint ventures in which the  Partnership is a co-venturer,  but not in excess of
competitive fees for comparable services.  Under the management  agreement,  the
management  fee is  subordinated  to  receipt  by  the  Limited  Partners  of an
aggregate,  ten  percent,  cumulative,  noncompounded  annual  return  on  their
adjusted  capital  contributions  (the "10%  Preferred  Return"),  calculated in
accordance   with  the   Partnership's   limited   partnership   agreement  (the
"Partnership Agreement").

         Effective October 1, 1995, CNL Income Fund Advisors,  Inc. assigned its
rights  in,  and its  obligations  under,  the  management  agreement  with  the
Partnership  to CNL Fund  Advisors,  Inc. All of the terms and conditions of the
management agreement,  including the payment of fees, as described above, remain
unchanged.

         The management agreement continues until the Partnership no longer owns
an interest in any Properties unless terminated at an earlier date upon 60 days'
prior notice by either party.


                                        3

<PAGE>



Competition

         The fast-food and family-style  restaurant business is characterized by
intense  competition.  The restaurants on the Partnership's  Properties  compete
with  independently  owned  restaurants,  restaurants which are part of local or
regional chains, and restaurants in other well-known national chains,  including
those which offer different types of food and service.

         At the time the Partnership elects to dispose of its Properties,  other
than as a result of the exercise of tenant options to purchase  Properties,  the
Partnership  will be in  competition  with other  persons and entities to locate
purchasers for its Properties.

Employees

         The  Partnership   has  no  employees.   The  officers  of  CNL  Realty
Corporation  and the officers and employees of CNL Fund Advisors,  Inc.  perform
certain  services for the  Partnership.  In addition,  the General Partners have
available to them the  resources  and expertise of the officers and employees of
CNL Group, Inc., a diversified real estate company, and its affiliates,  who may
also perform certain services for the Partnership.


Item 2.  Properties

         As of December 31, 1997,  the  Partnership  owned,  either  directly or
through  joint  venture  arrangements,  49  Properties,  located  in 18  states.
Reference  is made to the Schedule of Real Estate and  Accumulated  Depreciation
filed  with this  report for a listing of the  Properties  and their  respective
costs, including acquisition fees and certain acquisition expenses.

Description of Properties

         Land. The Partnership's  Property sites range from approximately 14,000
to 200,900  square  feet  depending  upon  building  size and local  demographic
factors.  Sites  purchased  by  the  Partnership  are  in  locations  zoned  for
commercial use which have been reviewed for traffic patterns and volume.

         Buildings.  Each of the Properties  owned by the Partnership  include a
building that is one of a Restaurant  Chain's  approved  designs.  The buildings
generally are  rectangular  and are  constructed  from various  combinations  of
stucco,  steel,  wood, brick and tile.  Building sizes range from  approximately
1,800 to 10,700 square feet.  All buildings on Properties are  freestanding  and
surrounded by paved  parking  areas.  Buildings  are suitable for  conversion to
various uses, although modifications may be required prior to use for other than
restaurant operations.

         Generally,  a  lessee  is  required,  under  the  terms  of  its  lease
agreement,  to make such capital  expenditures as may be reasonably necessary to
refurbish restaurant  buildings,  premises,  signs and equipment so as to comply
with the lessee's obligations,  if applicable,  under the franchise agreement to
reflect the current  commercial  image of its  Restaurant  Chain.  These capital
expenditures are required to be paid by the lessee during the term of the lease.

         Leases  with  Major   Tenants.   The  terms  of  the  leases  with  the
Partnership's  major  tenants as of December  31,  1997 (see Item 1.  Business -
Major  Tenants),  are  substantially  the  same as  those  described  in Item 1.
Business - Leases.

         Golden Corral  Corporation leases four Golden Corral  restaurants.  The
initial term of each lease is 15 years (expiring  between 2007 and 2011) and the
average minimum base rent is approximately  $156,900 (ranging from approximately
$88,100 to $198,500).

         Foodmaker,  Inc.  leases six Jack in the Box  restaurants.  The initial
term of each lease is between 18 and 20 years  (expiring  between 2009 and 2012)
and the  average  minimum  base  rent is  approximately  $81,600  (ranging  from
approximately $62,900 to $99,400).


                                        4

<PAGE>



         Flagstar  Corporation leases seven Hardee's restaurants and two Denny's
restaurants.  The initial term of each lease is 20 years  (expiring in 2012) and
the  average  minimum  base  rent  is   approximately   $69,100   (ranging  from
approximately $43,500 to $111,800).

         The General Partners consider the Properties to be well-maintained  and
sufficient for the Partnership's operations.

Item 3.  Legal Proceedings

         Neither the  Partnership,  nor its General Partners or any affiliate of
the General Partners, nor any of their respective properties,  is a party to, or
subject to, any material pending legal proceedings.


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

         Not applicable.



                                     PART II


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

         As of  February  28,  1998,  there were 3,531  holders of record of the
Units.  There  is no  public  trading  market  for  the  Units,  and  it is  not
anticipated  that a public market for the Units will develop.  Limited  Partners
who wish to sell  their  Units may offer  the  Units  for sale  pursuant  to the
Partnership's  distribution reinvestment plan (the "Plan"), and Limited Partners
who wish to have their  distributions  used to acquire  additional Units (to the
extent Units are available  for  purchase) may do so pursuant to such Plan.  The
General Partners have the right to prohibit transfers of Units. Since inception,
the price for any Unit transferred pursuant to the Plan has been $9.50 per Unit.
The price to be paid for any Unit transferred other than pursuant to the Plan is
subject to negotiation  by the purchaser and the selling  Limited  Partner.  The
Partnership will not redeem or repurchase Units.

         The following table reflects,  for each calendar quarter, the high, low
and average  sales prices for transfers of Units during 1997 and 1996 other than
pursuant to the Plan, net of commissions.

<TABLE>
<CAPTION>

                                          1997 (1)                         1996 (1)
                            ----------------------------------    ----------------------
<S> <C>
                                High       Low      Average        High       Low      Average
         First Quarter         $ 9.50    $ 7.75      $ 9.13       $10.00    $ 8.10      $ 9.37
         Second Quarter          8.70      7.75        8.38         9.50      9.50        9.50
         Third Quarter           9.50      8.25        8.67         8.15      5.74        6.61
         Fourth Quarter          9.20      8.65        8.62         8.50      7.60        8.20

</TABLE>

(1)      A total of 15,700 and 26,865 Units were transferred other than pursuant
         to  the  Plan  for  the  years  ended   December  31,  1997  and  1996,
         respectively.

         The  capital  contribution  per Unit was $10.  All cash  available  for
distribution  will be distributed to the partners  pursuant to the provisions of
the Partnership Agreement.

         For the  years  ended  December  31,  1997 and  1996,  the  Partnership
declared cash distributions of $3,600,003 and $3,640,003,  respectively,  to the
Limited  Partners.  During the year ended  December  31, 1996,  the  Partnership
declared  a special  distribution  to the  Limited  Partners  of  $40,000  which
represented   cumulative  excess  operating   reserves.   The  General  Partners
anticipate  that the  Partnership  will  declare a special  distribution  to the
Limited  Partners  during  the  quarter  ending  March  31,  1998,  representing
cumulative excess operating reserves. No amounts

                                        5

<PAGE>



distributed  to partners  for the years ended  December  31, 1997 and 1996,  are
required to be or have been  treated by the  Partnership  as a return of capital
for  purposes of  calculating  the Limited  Partners'  return on their  adjusted
capital  contributions.  No distributions have been made to the General Partners
to date. As indicated in the chart below,  these  distributions were declared at
the close of each of the Partnership's calendar quarters.  These amounts include
monthly  distributions  made in arrears  for the  Limited  Partners  electing to
receive such distributions on this basis.

         Quarter Ended                   1997             1996
         -------------                ---------         ----------
         March 31                      $900,000          $900,001
         June 30                        900,001           900,001
         September 30                   900,001           900,001
         December 31                    900,001           940,000

         The  Partnership  intends to  continue  to make  distributions  of cash
available  for  distribution  to the  Limited  Partners  on a  quarterly  basis,
although some Limited  Partners,  in  accordance  with their  election,  receive
monthly distributions, for an annual fee.


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

                                       1997           1996           1995            1994           1993
                                  -------------  -------------  -------------   -------------  -------------
<S> <C>
Year Ended December 31:
  Revenues (1)                     $  3,813,248   $  3,871,869   $  3,875,779    $  4,020,289   $  4,030,010
  Net income (2)                      3,531,381      3,461,812      3,552,067       3,672,841      3,636,573
  Cash distributions declared (3)     3,600,003      3,640,003      3,640,003       3,625,017      3,500,000
  Net income per Unit (2)                   .87            .86            .88            .91             .90
  Cash distributions declared per
     Unit (3)                               .90            .91            .91             .91            .88

At December 31:
  Total assets                      $36,289,727    $36,437,560    $36,563,796     $36,722,696    $36,462,746
  Partners' capital                  35,154,043     35,222,665     35,400,856      35,488,792     35,440,968
</TABLE>

(1)      Revenues  include equity in earnings of  unconsolidated  joint ventures
         and minority interest in income of the consolidated joint venture.

(2)      Net income for the years  ended  December  31,  1997 and 1995,  include
         $132,238  and  $67,214,  respectively,  from  gains on sale of land and
         buildings.

(3)      Distributions  for the years ended  December  31,  1996 and 1995,  each
         include a special distribution to the Limited Partners of $40,000 which
         represented cumulative excess operating reserves.

         The above selected  financial  data should be read in conjunction  with
the financial statements and related notes contained in Item 8 hereof.


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

         The  Partnership  was organized on April 16, 1990, to acquire for cash,
either directly or through joint venture  arrangements,  both newly  constructed
and  existing  restaurant  Properties,  as well as land  upon  which  restaurant
Properties  were to be constructed,  which are leased  primarily to operators of
selected national and regional fast-food and family-style Restaurant Chains. The
leases are triple-net  leases,  with the lessees  generally  responsible for all
repairs and maintenance, property taxes, insurance and utilities. As of December
31, 1997, the  Partnership  owned 49 Properties,  either  directly or indirectly
through joint venture arrangements.



                                        6

<PAGE>



Liquidity and Capital Resources

         The  Partnership's  primary  source  of  capital  for the  years  ended
December 31, 1997, 1996 and 1995, was cash from operations  (which includes cash
received from tenants,  distributions from joint ventures and interest received,
less cash paid for expenses).  Cash from operations was  $3,596,417,  $3,695,802
and  $3,527,362  for  the  years  ended  December  31,  1997,   1996  and  1995,
respectively.  The decrease in cash from operations  during 1997, as compared to
1996,  and the increase in 1996,  as compared to 1995,  is primarily a result of
changes in the  Partnership's  working  capital  during  each of the  respective
years.

         Other  sources and uses of capital  included the  following  during the
years ended December 31, 1997, 1996 and 1995.

         In July 1995, the  Partnership  sold a small parcel of land as a result
of an easement relating to its Property in Hendersonville,  North Carolina,  for
$7,200,  resulting  in a gain of $1,112 for  financial  reporting  purposes.  In
addition, in August 1995, the Partnership sold its Property in Denver, Colorado,
for $1,057,000  and received net sales  proceeds of  $1,050,186,  resulting in a
gain of $66,102 for financial reporting  purposes.  This Property was originally
acquired by the  Partnership  in December  1991 and had a cost of  approximately
$977,000,  excluding  acquisition fees and miscellaneous  acquisition  expenses;
therefore, the Partnership sold the Property for approximately $73,200 in excess
of its original  purchase price.  In September 1995, the Partnership  reinvested
$928,122 in a Shoney's in Fort Myers Beach, Florida.

         In October 1995, the tenant of the  Partnership's  Property  located in
Austin,  Texas,  entered into a sublease  agreement  for a vacant parcel of land
under which the subtenant  has the option to purchase  such land.  The subtenant
exercised the purchase  option and in accordance  with the terms of the sublease
agreement, the tenant assigned the purchase contract, together with the purchase
contract  payment of  $69,000  from the  subtenant,  to the  Partnership.  As of
February  28,  1998,  the  sale  for the  vacant  parcel  of land  had not  been
consummated  and as a result,  the net  proceeds  of $68,000  (representing  the
original $69,000  received by the Partnership,  less $1,000 in costs incurred in
anticipation of the sale) were recorded as a deposit at December 31, 1997.

         In January 1996,  the  Partnership  reinvested  the remaining net sales
proceeds  from  the 1995  sale of the  Property  in  Denver,  Colorado,  and the
proceeds  from  the  granting  of  an  easement  relating  to  the  Property  in
Hendersonville,  North Carolina, in a Golden Corral Property located in Clinton,
North Carolina, with affiliates of the General Partners as tenants-in-common. In
connection  therewith,  the  Partnership  and  its  affiliates  entered  into an
agreement  whereby each  co-venturer will share in the profits and losses of the
Property in proportion to its applicable percentage interest. As of December 31,
1997, the Partnership owned a 13.37% interest in this Property.

         In  September  1997,  the  Partnership  sold its  Property  in Fremont,
California,  to the  franchisor,  for $1,420,000 and received net sales proceeds
(net of $2,745 which  represents  amounts due to the former  tenant for prorated
rent) of  $1,363,805,  resulting in a gain of $132,238 for  financial  reporting
purposes. This Property was originally acquired by the Partnership in March 1992
and had a cost of  approximately  $1,116,900,  excluding  acquisition  fees  and
miscellaneous acquisition expenses; therefore, the Partnership sold the Property
for approximately  $249,700 in excess of its original purchase price. In October
1997,  the  Partnership  reinvested  approximately  $1,277,300  of the net sales
proceeds in a Boston  Market  Property in  Homewood,  Alabama.  The  Partnership
acquired the Boston Market  Property from an affiliate of the General  Partners.
The affiliate had purchased and temporarily  held title to the Property in order
to facilitate the acquisition of the Property by the  Partnership.  The purchase
price paid by the Partnership represented the costs incurred by the affiliate to
acquire the Property, including closing costs. The General Partners believe that
the transaction,  or a portion thereof,  relating to the sale of the Property in
Fremont,  California,  and the  reinvestment  of the proceeds in a Boston Market
Property in Homewood,  Alabama, will qualify as a like-kind exchange transaction
for federal  income tax  purposes.  However,  the  Partnership  will  distribute
amounts  sufficient  to enable the  Limited  Partners  to pay  federal and state
income taxes,  if any (at a level  reasonably  assumed by the General  Partners)
resulting from the sale. The  Partnership  intends to reinvest the remaining net
sales  proceeds  in an  additional  Property  or  use  such  amounts  for  other
Partnership purposes.

         In December 1997, the Partnership used approximately  $130,400 that had
been previously  reserved for working capital  purposes,  to invest in a Chevy's
Fresh Mex Property  located in Miami,  Florida,  with  affiliates of the General
Partners as tenants-in-common.  In connection therewith, the Partnership and its
affiliates entered into

                                        7

<PAGE>



an agreement  whereby each  co-venturer  will share in the profits and losses of
the Property in proportion to its applicable percentage interest. As of December
31, 1997, the Partnership owned a 6.69% interest in this Property.

         During  1997,  the  Partnership  entered  into a  contract  to sell the
Property  in  Sacramento,  California,  to the  tenant.  In  January  1998,  the
Partnership sold this Property for $1,250,000 and received net sales proceeds of
$1,234,175,  resulting  in  a  gain  of  approximately  $163,300  for  financial
reporting  purposes.  The Partnership intends to reinvest the net sales proceeds
in an additional Property.

         None of the Properties  owned by the  Partnership or the joint ventures
in which the  Partnership  owns an interest is or may be  encumbered.  Under its
Partnership  Agreement,  the  Partnership  is prohibited  from borrowing for any
purpose;  provided,  however,  that the General Partners or their affiliates are
entitled to reimbursement,  at cost, for actual expenses incurred by the General
Partners or their  affiliates  on behalf of the  Partnership.  Affiliates of the
General Partners from time to time incur certain operating expenses on behalf of
the  Partnership  for which the  Partnership  reimburses the affiliates  without
interest.

         Currently,  rental income from the Partnership's Properties is invested
in money market accounts or other short-term highly liquid  investments  pending
the  Partnership's  use of such  funds to pay  Partnership  expenses  or to make
distributions to partners.  At December 31, 1997, the Partnership had $1,583,883
invested in such  short-term  investments  as compared to $1,769,483 at December
31,  1996.  The decrease in cash is primarily  attributable  to the  Partnership
using  approximately  $130,400  that had been  previously  reserved  for working
capital  purposes,  to invest in a  Property  located  in Miami,  Florida,  with
affiliates,  as  tenants-in-common,  in December  1997.  The funds  remaining at
December 31, 1997, after payment of distributions and other liabilities, will be
used to meet the Partnership's working capital and other needs.

         During 1997, 1996 and 1995, affiliates of the General Partners incurred
$86,327, $112,363 and $100,249, respectively, for certain operating expenses. As
of  December  31,  1997 and  1996,  the  Partnership  owed  $4,946  and  $1,609,
respectively,  to affiliates for such amounts and accounting and  administrative
services. As of February 28, 1998, the Partnership had reimbursed the affiliates
all such amounts. Other liabilities,  including distributions payable, decreased
to  $1,066,237  at December  31,  1997,  from  $1,148,901  at December 31, 1996,
partially  as the result of the  Partnership's  accruing a special  distribution
payable to the Limited  Partners of $40,000 at December 31, 1996, which was paid
in January 1997. Other  liabilities also decreased due to a decrease in escrowed
real estate taxes  payable and rents paid in advance at December  31, 1997.  The
General  Partners  believe that the  Partnership  has sufficient cash on hand to
meet its current working capital needs.

         Based on cash from operations,  and during the years ended December 31,
1996 and 1995,  cumulative excess operating reserves,  the Partnership  declared
distributions  to the Limited Partners of $3,600,003 for the year ended December
31, 1997 and  $3,640,003 for each of the years ended December 31, 1996 and 1995.
This represents  distributions of $0.90 per Unit for the year ended December 31,
1997 and $0.91 per Unit for each of the years ended  December 31, 1996 and 1995.
The General  Partners  anticipate  that the  Partnership  will declare a special
distribution  to the Limited  Partners during the quarter ending March 31, 1998,
representing cumulative excess operating reserves. No amounts distributed to the
Limited  Partners  for the years ended  December 31,  1997,  1996 and 1995,  are
required to be or have been  treated by the  Partnership  as a return of capital
for  purposes of  calculating  the Limited  Partners'  return on their  adjusted
capital contributions. The Partnership intends to continue to make distributions
of cash available for distribution to the Limited Partners on a quarterly basis.

         The General Partners believe that the Properties are adequately covered
by  insurance.  In  addition,  the General  Partners  have  obtained  contingent
liability and property coverage for the Partnership.  This insurance is intended
to reduce the Partnership's  exposure in the unlikely event a tenant's insurance
policy lapses or is insufficient to cover a claim relating to the Property.

         The Partnership's  investment strategy of acquiring Properties for cash
and  leasing  them under  triple-net  leases to  operators  who  generally  meet
specified financial  standards  minimizes the Partnership's  operating expenses.
The General Partners believe that the leases will continue to generate cash flow
in excess of operating expenses.

         Due to low  operating  expenses  and  ongoing  cash flow,  the  General
Partners believe that the Partnership has sufficient working capital reserves at
this time. In addition,  because all leases of the Partnership's  Properties are
on

                                        8

<PAGE>



a  triple-net  basis,  it is  not  anticipated  that  a  permanent  reserve  for
maintenance  and  repairs  will be  established  at this  time.  To the  extent,
however,  that the  Partnership  has  insufficient  funds for such purpose,  the
General Partners will contribute to the Partnership an aggregate amount of up to
one percent of the offering proceeds for maintenance and repairs.

         The General  Partners have the right,  but not the obligation,  to make
additional capital  contributions if they deem it appropriate in connection with
the operations of the Partnership.

Results of Operations

         During  1995,  the  Partnership   owned  and  leased  39  wholly  owned
Properties (including one Property in Denver, Colorado, which was sold in August
1995), during 1996, the Partnership owned and leased 38 wholly owned Properties,
and during 1997,  the  Partnership  owned and leased 39 wholly owned  Properties
(including  one  Property in Fremont,  California,  which was sold in  September
1997).  In  addition,  during  1997,  1996  and  1995,  the  Partnership  was  a
co-venturer  in three  separate  joint  ventures  that each owned and leased one
Property and one joint  venture  which owned and leased six  Properties.  During
1996,  the  Partnership  also owned and leased one Property  with  affiliates as
tenants-in-common  and  during  1997,  the  Partnership  owned  and  leased  two
Properties  with affiliates as  tenants-in-common.  As of December 31, 1997, the
Partnership  owned,  either  directly or through joint venture  arrangements  49
Properties which are subject to long-term,  triple-net leases. The leases of the
Properties  provide for minimum base annual rental  amounts  (payable in monthly
installments) ranging from approximately $26,200 to $198,500.  All of the leases
provide for percentage rent based on sales in excess of a specified  amount.  In
addition,  a majority of the leases provide that,  commencing in specified lease
years  (ranging  from the second to the sixth lease year),  the annual base rent
required under the terms of the lease will increase.  For further description of
the Partnership's leases and Properties,  see Item 1. Business - Leases and Item
2. Properties, respectively.

         During  the  years  ended  December  31,  1997,   1996  and  1995,  the
Partnership  and its  consolidated  joint  venture,  Allegan  Real Estate  Joint
Venture, earned $3,402,320,  $3,481,139 and $3,474,227,  respectively, in rental
income from operating leases and earned income from direct financing leases. The
decrease in rental and earned  income  during  1997,  as  compared  to 1996,  is
partially  attributable to the Partnership increasing its allowance for doubtful
accounts by  approximately  $64,600 during 1997, for rental amounts  relating to
the Perkins  Properties  located in Lancaster and Amherst,  New York,  which are
leased by the same  tenant,  due to the  financial  difficulties  the  tenant is
experiencing.  No such allowance was  established  during 1996. The  Partnership
intends  to pursue  collection  of past due  amounts  from this  tenant and will
recognize  such amounts as income if  collected.  Rental and earned  income also
decreased by approximately  $36,600 during 1997, as compared to 1996, due to the
fact that the Partnership sold its Property in Fremont, California, in September
1997. This decrease was partially offset by an increase of approximately $28,100
in rental  income as a result of  reinvesting  the  majority  of these net sales
proceeds in a Property in Homewood, Alabama, in October 1997.

         During  the  years  ended  December  31,  1997,   1996  and  1995,  the
Partnership  also  earned  $51,678,  $45,126  and  $53,189,   respectively,   in
contingent rental income.  The increase in contingent rental income during 1997,
as compared to 1996,  is primarily  attributable  to a change in the  percentage
rent formula in accordance  with the terms of the lease agreement for one of the
Partnership's  leases during 1997. The decrease in contingent  rent during 1996,
as compared to 1995, was primarily a result of decreases in gross sales relating
to certain restaurant Properties during 1996.

         For the years ended December 31, 1997,  1996 and 1995, the  Partnership
also earned $278,919, $278,371 and $267,799,  respectively,  attributable to net
income earned by  unconsolidated  joint  ventures in which the  Partnership is a
co-venturer.  The increase in net income earned by unconsolidated joint ventures
during 1996, as compared to 1995, is primarily  attributable  to the Partnership
investing  in a Property in  Clinton,  North  Carolina,  in January  1996,  with
affiliates of the General Partners as  tenants-in-common,  as described above in
"Liquidity and Capital Resources."

         During at least one of the years  ended  December  31,  1997,  1996 and
1995, three lessees (or group of affiliated lessees), of the Partnership and its
consolidated  joint  venture,  Golden Corral  Corporation,  Foodmaker,  Inc. and
Flagstar   Corporation,   each   contributed   more  than  ten  percent  of  the
Partnership's   total  rental   income   (including   rental   income  from  the
Partnership's  consolidated joint venture and the Partnership's  share of rental
income from

                                        9

<PAGE>



eight Properties owned by unconsolidated joint ventures and two Properties owned
with affiliates as  tenants-in-common).  As of December 31, 1997,  Golden Corral
Corporation was the lessee under leases relating to four restaurants, Foodmaker,
Inc.  was the lessee  under  leases  relating to six  restaurants  and  Flagstar
Corporation  was the lessee under  leases  relating to nine  restaurants.  It is
anticipated  that based on the minimum rental  payments  required by the leases,
these three  lessees (or groups of  affiliated  lessees)  each will  continue to
contribute more than ten percent of the Partnership's total rental income during
1998 and subsequent  years. In addition,  during at least one of the years ended
December  31,  1997,  1996 and 1995,  five  Restaurant  Chains,  Golden  Corral,
Hardee's,  Burger King,  Shoney's and Jack in the Box,  each  accounted for more
than ten percent of the  Partnership's  total rental  income  (including  rental
income from the Partnership's  consolidated  joint venture and the Partnership's
share of rental  income  from eight  Properties  owned by  unconsolidated  joint
ventures and two  Properties  owned with  affiliates as  tenants-in-common).  In
subsequent  years, it is anticipated that these five Restaurant Chains each will
continue to account for more than ten percent of the Partnership's  total rental
income to which the  Partnership is entitled under the terms of the leases.  Any
failure of these  lessees  or  Restaurant  Chains  could  materially  affect the
Partnership's income.

         Operating expenses,  including  depreciation and amortization  expense,
were $414,105, $410,057 and $390,926 for the years ended December 31, 1997, 1996
and 1995,  respectively.  The increase in  operating  expenses  during 1997,  as
compared  to  1996,  is  partially  a  result  of  the   Partnership   recording
approximately  $9,700,  for real estate taxes relating to the Perkins Properties
located in Lancaster and Amherst, New York, which are leased by the same tenant,
due to the current financial  difficulties of the tenant. Payment of these taxes
remains the responsibility of the tenant of this Property;  however, the General
Partners  believe that the tenant's  ability to pay these  expenses is doubtful.
The Partnership intends to pursue collection from the tenant of any such amounts
paid by the  Partnership and will recognize such amounts as income if collected.
The  increase in  operating  expenses  during  1997,  as  compared  to 1996,  is
partially  offset  by a  decrease  in  accounting  and  administrative  expenses
associated with operating the Partnership and its Properties.

         The increase in operating expenses during 1997, as compared to 1996, is
also  partially  attributable  to, and the increase  during 1996, as compared to
1995,  is partially  offset by a decrease in state taxes during 1996 as a result
of receiving a state tax refund from the state of New Hampshire during 1996, for
taxes paid in prior years.

         Operating  expenses  increased during 1996, as compared to 1995, due to
an increase in accounting and administrative  expenses associated with operating
the  Partnership  and its Properties  and an increase in insurance  expense as a
result of the General  Partners'  obtaining  contingent  liability  and Property
coverage for the  Partnership  beginning in May 1995.  Operating  expenses  also
increased  during 1996, as compared to 1995, due to an increase in  professional
fees during the year ended December 31, 1996, as a result of obtaining appraisal
updates for 1996 and 1995, to prepare an annual  statement of unit  valuation to
qualified plans in accordance with the Partnership's partnership agreement.

         As a result of the sale of the  Property  in  Fremont,  California,  as
discussed above in "Liquidity and Capital Resources," the Partnership recognized
a gain of $132,238 for financial  reporting purposes for the year ended December
31, 1997.  In addition,  as a result of the granting of an easement  relating to
the Property in Hendersonville,  North Carolina, and the sale of the Property in
Denver,  Colorado,  as described above in "Liquidity and Capital Resources," the
Partnership recognized a gain for financial reporting purposes of $67,214 during
the year ended December 31, 1995. No Properties  were sold during the year ended
December 31, 1996.

         The General Partners of the Partnership are in the process of assessing
and addressing the impact of the year 2000 on its company package software.  The
hardware  and  built-in  software  are  believed  to  be  year  2000  compliant.
Accordingly, the General Partners do not expect this matter to materially impact
how the  Partnership  conducts  business  nor its  current or future  results of
operations or financial position.

         The Partnership's leases as of December 31, 1997, are triple-net leases
and contain  provisions that the General  Partners  believe mitigate the adverse
effect of inflation.  Such provisions  include clauses  requiring the payment of
percentage rent based on certain restaurant sales above a specified level and/or
automatic  increases  in base rent at  specified  times  during  the term of the
lease.  Management  expects that  increases in  restaurant  sales volumes due to
inflation  and real sales growth  should  result in an increase in rental income
over  time.  Continued  inflation  also may cause  capital  appreciation  of the
Partnership's Properties. Inflation and changing prices, however,

                                       10

<PAGE>



also may have an adverse impact on the sales of the restaurants and on potential
capital appreciation of the Properties.


Item 8.   Financial Statements and Supplementary Data

                                       11

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                                    CONTENTS


                                                        Page

Report of Independent Accountants                        13

Financial Statements:

  Balance Sheets                                         14

  Statements of Income                                   15

  Statements of Partners' Capital                        16

  Statements of Cash Flows                               17

  Notes to Financial Statements                          19

                                       12

<PAGE>







                        Report of Independent Accountants



To the Partners
CNL Income Fund X, Ltd.


We have audited the financial  statements and the financial  statement schedules
of CNL Income Fund X, Ltd. (a Florida limited  partnership) listed in Item 14(a)
of this Form 10-K. These financial  statements and financial statement schedules
are the responsibility of the Partnership's management. Our responsibility is to
express  an  opinion  on these  financial  statements  and  financial  statement
schedules based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial position of CNL Income Fund X, Ltd. as of
December 31, 1997 and 1996, and the results of its operations and its cash flows
for each of the three years in the period ended  December 31, 1997 in conformity
with generally accepted accounting principles.  In addition, in our opinion, the
financial  statement schedules referred to above, when considered in relation to
the basic financial statements taken as a whole, present fairly, in all material
respects, the information required to be included therein.




/s/ Coopers & Lybrand, L.L.P.
--------------------------------

Orlando, Florida
January 14, 1998

                                       13

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                                 BALANCE SHEETS


                                                   December 31,
            ASSETS                            1997              1996
            ------                         -----------       -----------

Land and buildings on operating
  leases, less accumulated
  depreciation                             $15,709,899       $15,224,392
Net investment in direct financing
  leases                                    13,460,125        14,219,805
Investment in joint ventures                 3,505,326         3,449,210
Cash and cash equivalents                    1,583,883         1,769,483
Restricted cash                                 92,236                -
Receivables, less allowance for
  doubtful accounts of $137,856
  and $4,428                                   123,903            52,470
Prepaid expenses                                 5,877             5,503
Accrued rental income, less
  allowance for doubtful accounts
  of $117,593 and $88,781                    1,775,374         1,683,593
Other assets                                    33,104            33,104
                                           -----------       -----------

                                           $36,289,727       $36,437,560
                                           ===========       ===========


  LIABILITIES AND PARTNERS' CAPITAL

Accounts payable                           $     6,033       $     2,913
Escrowed real estate taxes payable              27,784            45,060
Distributions payable                          900,001           940,000
Due to related parties                           4,946             1,609
Rents paid in advance and deposits             132,419           160,928
                                           -----------       -----------
    Total liabilities                        1,071,183         1,150,510

Commitments and Contingencies (Note 11)

Minority interest                               64,501            64,385

Partners' capital                           35,154,043        35,222,665
                                           -----------       -----------

                                           $36,289,727       $36,437,560
                                           ===========       ===========










                 See accompanying notes to financial statements.

                                       14

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                              STATEMENTS OF INCOME

<TABLE>
<CAPTION>


                                                                               Year Ended December 31,
                                                                   1997                1996               1995
                                                                ----------          ----------         -------
<S> <C>
Revenues:
  Rental income from
    operating leases                                            $1,867,795          $1,832,781         $1,783,928
  Earned income from direct
    financing leases                                             1,534,525           1,648,358          1,690,299
  Contingent rental income                                          51,678              45,126             53,189
  Interest and other income                                         88,853              75,896             89,630
                                                                ----------          ----------         ----------
                                                                 3,542,851           3,602,161          3,617,046
                                                                ----------          ----------         ----------

Expenses:
  General operating and
    administrative                                                 153,672             166,049            150,157
  Professional services                                             26,890              33,692             23,563
  Real estate taxes                                                  9,703                  -                  -
  State and other taxes                                              9,372               2,357             15,510
  Depreciation and amortization                                    214,468             207,959            201,696
                                                                ----------          ----------         ----------
                                                                   414,105             410,057            390,926
                                                                ----------          ----------         ----------

Income Before Minority Interest
  in Income of Consolidated
  Joint Venture, Equity in
  Earnings of Unconsolidated
  Joint Ventures and Gain on
  Sale of Land and Building                                      3,128,746           3,192,104          3,226,120

Minority Interest in Income of
  Consolidated Joint Venture                                        (8,522)             (8,663)            (9,066)

Equity in Earnings of
  Unconsolidated Joint Ventures                                    278,919             278,371            267,799

Gain on Sale of Land and Building                                  132,238                  -              67,214
                                                                ----------          ----------         ----------

Net Income                                                      $3,531,381          $3,461,812         $3,552,067
                                                                ==========          ==========         ==========

Allocation of Net Income:
  General partners                                              $   33,991          $   34,618         $   35,491
  Limited partners                                               3,497,390           3,427,194          3,516,576
                                                                ----------          ----------         ----------

                                                                $3,531,381          $3,461,812         $3,552,067
                                                                ==========          ==========         ==========

Net Income per Limited Partner
  Unit                                                          $     0.87          $     0.86         $     0.88
                                                                ==========          ==========         ==========

Weighted Average Number of Limited
  Partner Units Outstanding                                      4,000,000           4,000,000          4,000,000
                                                                ==========          ==========         ==========

</TABLE>








                 See accompanying notes to financial statements.

                                       15

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                         STATEMENTS OF PARTNERS' CAPITAL

                  Years Ended December 31, 1997, 1996 and 1995


<TABLE>
<CAPTION>

                                      General Partners                       Limited Partners
                                              Accumu-                                           Accumu-
                                   Contri-    lated         Contri-        Distri-           lated      Syndication
                                   butions   Earnings       butions        butions          Earnings       Costs           Total
                                   -------   --------     -----------   ------------      -----------   -----------     ----------
<S> <C>
Balance, December 31, 1994         $ 1,000   $103,609     $40,000,000   $(10,083,130)     $10,257,313   $(4,790,000)    $35,488,792

  Distributions to limited
    partners ($0.91 per
    limited partner unit)               -          -               -      (3,640,003)              -             -       (3,640,003)
  Net income                            -      35,491              -              -         3,516,576            -        3,552,067
                                    ------   --------     -----------   ------------      -----------   -----------     -----------

Balance, December 31, 1995           1,000    139,100      40,000,000    (13,723,133)      13,773,889    (4,790,000)     35,400,856

  Distributions to limited
    partners ($0.91 per
    limited partner unit)               -          -               -      (3,640,003)              -             -       (3,640,003)
  Net income                            -      34,618              -              -         3,427,194            -        3,461,812
                                    ------   --------     -----------   ------------      -----------   -----------     -----------

Balance, December 31, 1996           1,000    173,718      40,000,000    (17,363,136)      17,201,083    (4,790,000)     35,222,665

  Distributions to limited
    partners ($0.90 per
    limited partner unit)               -          -               -      (3,600,003)              -             -       (3,600,003)
  Net income                            -      33,991              -              -         3,497,390            -        3,531,381
                                    ------   --------     -----------   ------------      -----------   -----------     -----------

Balance, December 31, 1997          $1,000   $207,709     $40,000,000   $(20,963,139)     $20,698,473   $(4,790,000)    $35,154,043
                                    ======   ========     ===========   ============      ===========   ===========     ===========
</TABLE>



                 See accompanying notes to financial statements.

                                       16

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                                Year Ended December 31,
                                                                   1997                1996               1995
                                                               -----------         -----------        --------
<S> <C>
Increase (Decrease) in Cash and
  Cash Equivalents:

    Cash Flows From Operating
      Activities:
        Cash received from tenants                             $ 3,380,391         $ 3,491,064        $ 3,290,242
        Distributions from uncon-
          solidated joint ventures                                 353,207             354,648            341,527
        Cash paid for expenses                                    (190,902)           (211,345)          (177,007)
        Interest received                                           53,721              61,435             72,600
                                                               -----------         -----------        -----------
            Net cash provided by
              operating activities                               3,596,417           3,695,802          3,527,362
                                                               -----------         -----------        -----------

    Cash Flows From Investing
      Activities:
        Proceeds from sale of
          land and building                                      1,363,805                  -           1,057,386
        Deposit received on
          contract for sale of
          land                                                          -                   -              69,000
        Additions to land and
          buildings on operating
          leases                                                (1,277,308)               (978)          (359,506)
        Investment in direct
          financing leases                                              -               (1,542)          (566,097)
        Investment in joint venture                               (130,404)           (108,952)                -
        Increase in restricted cash                                (89,702)                 -                  -
                                                               -----------         -----------        ----------
            Net cash provided by
              (used in) investing
              activities                                          (133,609)           (111,472)           200,783
                                                               -----------         -----------        -----------

    Cash Flows From Financing
      Activities:
        Distributions to limited
          partners                                              (3,640,002)         (3,640,003)        (3,700,003)
        Distributions to holder of
          minority interest                                         (8,406)             (7,697)            (7,998)
                                                               -----------         -----------        -----------
            Net cash used in
              financing activities                              (3,648,408)         (3,647,700)        (3,708,001)
                                                               -----------         -----------        -----------

Net Increase (Decrease) in Cash and
  Cash Equivalents                                                (185,600)            (63,370)            20,144

Cash and Cash Equivalents at
  Beginning of Year                                              1,769,483           1,832,853          1,812,709
                                                               -----------         -----------        -----------

Cash and Cash Equivalents at
  End of Year                                                  $ 1,583,883         $ 1,769,483        $ 1,832,853
                                                               ===========         ===========        ===========


</TABLE>






                 See accompanying notes to financial statements.

                                       17

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                      STATEMENTS OF CASH FLOWS - CONTINUED

<TABLE>
<CAPTION>

                                                                             Year Ended December 31,
                                                                   1997                1996               1995
                                                               -----------         -----------        -----------
<S> <C>
Reconciliation of Net Income to
  Net Cash Provided by Operating
  Activities:

    Net income                                                 $ 3,531,381         $ 3,461,812        $ 3,552,067
                                                               -----------         -----------        -----------
    Adjustments to reconcile net
      income to net cash provided
      by operating activities:
        Depreciation                                               214,468             206,497            199,696
        Amortization                                                    -                1,462              2,000
        Minority interest in income
          of consolidated joint
          venture                                                    8,522               8,663              9,066
        Equity in earnings of
          unconsolidated joint
          ventures, net of
          distributions                                             74,288              75,898             73,630
        Gain on sale of land and
          building                                                (132,238)                 -             (67,214)
        Decrease (increase) in
          receivables                                              (71,222)             46,834             10,222
        Increase in prepaid expenses                                  (374)             (3,852)              (664)
        Decrease in net investment
          in direct financing leases                               211,942             160,007            141,684
        Increase in accrued rental
          income                                                  (201,022)           (315,028)          (309,574)
        Increase (decrease) in
          accounts payable and
          accrued expenses                                         (14,156)             14,317             (1,057)
        Increase (decrease) in due
          to related parties                                         3,337              (5,395)             7,004
        Increase (decrease) in rents
          paid in advance and
          deposits                                                 (28,509)             44,587            (89,498)
                                                               -----------         -----------        -----------
            Total adjustments                                       65,036             233,990            (24,705)
                                                               -----------         -----------        -----------

Net Cash Provided by Operating
  Activities                                                   $ 3,596,417         $ 3,695,802        $ 3,527,362
                                                               ===========         ===========        ===========

Supplemental Schedule of Non-Cash
  Financing Activities:

    Distributions declared and
      unpaid at December 31                                   $    900,001         $   940,000        $   940,000
                                                              ============         ===========        ===========



</TABLE>


                 See accompanying notes to financial statements.

                                       18

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 1997, 1996 and 1995


1.       Significant Accounting Policies:

         Organization  and Nature of  Business - CNL  Income  Fund X, Ltd.  (the
         "Partnership") is a Florida limited  partnership that was organized for
         the purpose of acquiring both newly constructed and existing restaurant
         properties,  as well as properties  upon which  restaurants  were to be
         constructed,  which are leased  primarily  to operators of national and
         regional fast-food and family-style restaurant chains.

         The general partners of the Partnership are CNL Realty Corporation (the
         "Corporate  General  Partner"),  James M.  Seneff,  Jr.  and  Robert A.
         Bourne.  Mr. Seneff and Mr. Bourne are also 50 percent  shareholders of
         the Corporate General Partner. The general partners have responsibility
         for managing the day-to-day operations of the Partnership.

         Real  Estate  and  Lease  Accounting  -  The  Partnership  records  the
         acquisition of land and buildings at cost,  including  acquisition  and
         closing costs. Land and buildings are leased to unrelated third parties
         on a triple-net basis, whereby the tenant is generally  responsible for
         all operating  expenses  relating to the property,  including  property
         taxes, insurance, maintenance and repairs. The leases are accounted for
         using  either the  direct  financing  or the  operating  methods.  Such
         methods are described below:

                  Direct  financing  method - The leases accounted for using the
                  direct  financing  method are recorded at their net investment
                  (which at the inception of the lease generally  represents the
                  cost of the asset) (Note 4).  Unearned  income is deferred and
                  amortized  to income  over the lease  terms so as to produce a
                  constant  periodic  rate of  return on the  Partnership's  net
                  investment in the leases.

                  Operating  method - Land and  building  leases  accounted  for
                  using the  operating  method are recorded at cost,  revenue is
                  recognized as rentals are earned and  depreciation  is charged
                  to operations as incurred.  Buildings are  depreciated  on the
                  straight-line  method over their estimated  useful lives of 30
                  years.  When  scheduled  rentals  vary  during the lease term,
                  income is recognized on a straight-line basis so as to produce
                  a constant periodic rent over the lease term commencing on the
                  date the property is placed in service.

                                       19

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


1.       Significant Accounting Policies - Continued:

                  Accrued  rental  income  represents  the  aggregate  amount of
                  income  recognized  on a  straight-line  basis  in  excess  of
                  scheduled rental payments to date.

         When  the  properties  are  sold,  the  related  cost  and  accumulated
         depreciation  for operating  leases and the net  investment  for direct
         financing leases,  plus any accrued rental income, are removed from the
         accounts and gains or losses from sales are  reflected  in income.  The
         general  partners of the Partnership  review  properties for impairment
         whenever events or changes in circumstances  indicate that the carrying
         amount of the assets may not be  recoverable  through  operations.  The
         general partners  determine whether an impairment in value has occurred
         by comparing the estimated future  undiscounted  cash flows,  including
         the  residual  value of the  property,  with the  carrying  cost of the
         individual  property.  If an impairment  is  indicated,  the assets are
         adjusted to their fair value.

         When the  collection  of amounts  recorded as rental or other income is
         considered  to be  doubtful,  an  adjustment  is made to  increase  the
         allowance for doubtful accounts,  which is netted against  receivables,
         and to decrease rental or other income or increase bad debt expense for
         the  current  period,  although  the  Partnership  continued  to pursue
         collection of such amounts.  If amounts are subsequently  determined to
         be  uncollectible,  the  corresponding  receivable  and  allowance  for
         doubtful accounts are decreased accordingly.

         Investment in Joint Ventures - The Partnership  accounts for its 88.26%
         interest in Allegan Real Estate Joint Venture  using the  consolidation
         method.   Minority  interest  represents  the  minority  joint  venture
         partner's  proportionate  share  of the  equity  in  the  Partnership's
         consolidated joint venture. All significant  intercompany  accounts and
         transactions have been eliminated.

         The  Partnership's  investments  in  CNL  Restaurant  Investments  III,
         Williston Real Estate Joint Venture and Ashland Joint Venture,  and the
         property  in  Clinton,  North  Carolina,  and the  property  in  Miami,
         Florida,  for which each  property  is held as  tenants-in-common  with
         affiliates,  are  accounted  for  using  the  equity  method  since the
         Partnership  shares control with affiliates which have the same general
         partners.



                                       20

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


1.       Significant Accounting Policies - Continued:

         Cash and Cash Equivalents - The Partnership considers all highly liquid
         investments  with a maturity of three months or less when  purchased to
         be cash  equivalents.  Cash  and cash  equivalents  consist  of  demand
         deposits at commercial  banks and money market funds (some of which are
         backed by government  securities).  Cash equivalents are stated at cost
         plus accrued interest, which approximates market value.

         Cash  accounts  maintained  on  behalf  of the  Partnership  in  demand
         deposits  at  commercial  banks  and  money  market  funds  may  exceed
         federally insured levels;  however, the Partnership has not experienced
         any losses in such  accounts.  The  Partnership  limits  investment  of
         temporary cash investments to financial  institutions  with high credit
         standing;  therefore, the Partnership believes it is not exposed to any
         significant credit risk on cash and cash equivalents.

         Income Taxes - Under  Section 701 of the  Internal  Revenue  Code,  all
         income,  expenses and tax credit items flow through to the partners for
         tax  purposes.  Therefore,  no  provision  for federal  income taxes is
         provided in the accompanying  financial statements.  The Partnership is
         subject to certain state taxes on its income and property.

         Additionally,  for tax  purposes,  syndication  costs are  included  in
         Partnership equity and in the basis of each partner's  investment.  For
         financial  reporting  purposes,  syndication  costs are netted  against
         partners' capital and represent a reduction of Partnership equity and a
         reduction in the basis of each partner's investment.

         Use of Estimates - The general  partners of the Partnership have made a
         number of estimates and assumptions relating to the reporting of assets
         and liabilities and the disclosure of contingent assets and liabilities
         to prepare these  financial  statements in  conformity  with  generally
         accepted  accounting  principles.  The more significant areas requiring
         the use of  management  estimates  relate to the allowance for doubtful
         accounts  and future  cash flows  associated  with  long-lived  assets.
         Actual results could differ from those estimates.



                                       21

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


2.       Leases:

         The Partnership  leases its land and buildings to operators of national
         and regional  fast-food and  family-style  restaurants.  The leases are
         accounted for under the provisions of Statement of Financial Accounting
         Standards No. 13, "Accounting for Leases." Some of the leases have been
         classified  as  operating  leases  and  some of the  leases  have  been
         classified as direct  financing  leases.  For the leases  classified as
         direct financing  leases,  the building portions of the property leases
         are accounted for as direct financing leases while the land portions of
         the majority of these leases are operating  leases.  Substantially  all
         leases are for 15 to 20 years and provide  for  minimum and  contingent
         rentals.   In  addition,   the  tenant  pays  all  property  taxes  and
         assessments,  fully maintains the interior and exterior of the building
         and carries insurance  coverage for public liability,  property damage,
         fire and extended  coverage.  The lease options generally allow tenants
         to  renew  the  leases  for two to five  successive  five-year  periods
         subject to the same terms and  conditions  as the initial  lease.  Most
         leases  also allow the tenant to purchase  the  property at fair market
         value after a specified portion of the lease has elapsed.

3.       Land and Buildings on Operating Leases:

         Land and  buildings on operating  leases  consisted of the following at
         December 31:

                                            1997                   1996
                                         -----------            -----------

                  Land                   $ 9,947,295            $ 9,926,720
                  Buildings                6,875,851              6,196,451
                                         -----------            -----------
                                          16,823,146             16,123,171
                  Less accumulated
                    depreciation          (1,113,247)              (898,779)
                                         -----------            -----------

                                         $15,709,899            $15,224,392
                                         ===========            ===========



                                       22

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


3.       Land and Buildings on Operating Leases - Continued:

         In  September  1997,  the  Partnership  sold its  property  in Fremont,
         California,  to the  franchisor,  for $1,420,000 and received net sales
         proceeds  (net of $2,745  which  represents  amounts  due to the former
         tenant  for  prorated  rent)  of  $1,363,805,  resulting  in a gain  of
         $132,238 for financial reporting purposes. This property was originally
         acquired  by  the   Partnership  in  March  1992  and  had  a  cost  of
         approximately $1,116,900,  excluding acquisition fees and miscellaneous
         acquisition expenses;  therefore, the Partnership sold the property for
         approximately  $249,700 in excess of its original  purchase  price.  In
         October 1997, the Partnership reinvested  approximately $1,277,300 in a
         Boston Market property located in Homewood, Alabama.

         Some leases provide for escalating  guaranteed minimum rents throughout
         the  lease  term.   Income  from  these  scheduled  rent  increases  is
         recognized on a straight-line  basis over the terms of the leases.  For
         the years ended  December  31,  1997,  1996 and 1995,  the  Partnership
         recognized  $201,021,  $315,029  and  $309,574,  respectively,  of such
         rental income.

         The following is a schedule of the future  minimum lease payments to be
         received on noncancellable operating leases at December 31, 1997:

                  1998                          $ 1,796,664
                  1999                            1,817,764
                  2000                            1,830,536
                  2001                            1,875,201
                  2002                            2,004,123
                  Thereafter                     16,727,751
                                                -----------

                                                $26,052,039

         Since  lease  renewal  periods  are  exercisable  at the  option of the
         tenant, the above table only presents future minimum lease payments due
         during  the  initial  lease  terms.  In  addition,  this table does not
         include any amounts for future contingent rentals which may be received
         on the leases based on a percentage of the tenant's gross sales.





                                       23

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


4.       Net Investment in Direct Financing Leases:

         The  following  lists the  components  of the net  investment in direct
         financing leases at December 31:

                                                    1997              1996
                                                ------------      ------------

                  Minimum lease payments
                    receivable                  $ 25,273,063      $ 27,990,876
                  Estimated residual
                    values                         4,225,008         4,375,790
                  Less unearned income           (16,037,946)      (18,146,861)
                                                ------------      ------------

                  Net investment in direct
                    financing leases            $ 13,460,125      $ 14,219,805
                                                ============      ============

         In  September  1997,  the  Partnership  sold its  property  in Fremont,
         California,  for which the building  portion had been  classified  as a
         direct financing lease. In connection  therewith,  the gross investment
         (minimum  lease payment  receivable and estimated  residual  value) and
         unearned  income  relating  to this  property  were  removed  from  the
         accounts and the gain from the sale relating to the land portion of the
         property was reflected in income (Note 3).

         The  following  is a schedule of future  minimum  lease  payments to be
         received on the direct financing leases at December 31, 1997:

                    1998                            $ 1,758,896
                    1999                              1,761,323
                    2000                              1,762,806
                    2001                              1,770,249
                    2002                              1,800,446
                    Thereafter                       16,419,343
                                                    -----------

                                                    $25,273,063

         The above table does not include  future  minimum  lease  payments  for
         renewal  periods or for contingent  rental payments that may become due
         in future periods (see Note 3).





                                       24

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


4.       Net Investment in Direct Financing Leases - Continued:

         During the year  ended  December  31,  1996,  one of the  Partnership's
         leases was amended. As a result of the lease amendment, the Partnership
         reclassified  this lease from a direct  financing lease to an operating
         lease,  whereby the property was recorded at its net carrying  value of
         $567,923.

5.       Investment in Joint Ventures:

         The Partnership has a 50 percent, a 10.51% and a 41 percent interest in
         the profits and losses of CNL Restaurant Investments III, Ashland Joint
         Venture and  Williston  Real Estate Joint  Venture,  respectively.  The
         remaining  interests in these joint  ventures are held by affiliates of
         the Partnership which have the same general partners.

         In January  1996,  the  Partnership  acquired  and leased a property in
         Clinton,  North Carolina,  as tenants-in-common  with affiliates of the
         general partners.  The Partnership  accounts for its investment in this
         property using the equity method since the  Partnership  shares control
         with affiliates, and amounts relating to its investment are included in
         investment in joint ventures.  As of December 31, 1997, the Partnership
         owned a 13.37% interest in this property.

         In December  1997,  the  Partnership  acquired and leased a property in
         Miami,  Florida,  as  tenants-in-common  with affiliates of the general
         partners.  The Partnership accounts for its investment in this property
         using the equity  method  since the  Partnership  shares  control  with
         affiliates,  and amounts  relating to its  investment  are  included in
         investment in joint ventures.  As of December 31, 1997, the Partnership
         owned a 6.69% interest in this property.






                                       25

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


5.       Investment in Joint Ventures - Continued:

         CNL  Restaurant  Investments  III owns and leases six  properties to an
         operator of national  fast-food  restaurants.  Ashland  Joint  Venture,
         Williston Real Estate Joint Venture and the  Partnership and affiliates
         as  tenants-in-common in two separate  tenancy-in-common  arrangements,
         each own and lease one property to an operator of national fast-food or
         family- style  restaurants.  The following presents the joint ventures'
         combined, condensed financial information at December 31:

                                                     1997             1996
                                                  ----------       ----------

                  Land and buildings on
                    operating leases, less
                    accumulated deprecia-
                    tion                          $9,573,341       $7,822,804
                  Net investment in direct
                    financing lease                  661,991          658,422
                  Cash                                 8,197            1,750
                  Receivables                         26,766            8,164
                  Prepaid expenses                    22,852           21,910
                  Liabilities                          7,415            1,094
                  Partners' capital               10,285,732        8,511,956
                  Revenues                           930,470          916,897
                  Net income                         695,878          686,789

         The Partnership  recognized  income  totalling  $278,919,  $278,371 and
         $267,799  for the  years  ended  December  31,  1997,  1996  and  1995,
         respectively, from these joint ventures.

6.       Restricted Cash:

         As of December 31, 1997, net sales proceeds of $89,702 from the sale of
         the property in Fremont,  California,  plus accrued interest of $2,534,
         were being  held in an  interest-bearing  escrow  account  pending  the
         release of funds by the escrow agent to acquire an additional property.



                                       26

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


7.       Allocations and Distributions:

         Generally, all net income and net losses of the Partnership,  excluding
         gains and losses from the sale of properties,  are allocated 99 percent
         to the  limited  partners  and one  percent  to the  general  partners.
         Distributions  of net  cash  flow are made 99  percent  to the  limited
         partners and one percent to the general  partners;  provided,  however,
         that the one percent of net cash flow to be  distributed to the general
         partners  is  subordinated  to receipt by the  limited  partners  of an
         aggregate,  ten percent,  cumulative,  noncompounded  annual  return on
         their adjusted capital contributions (the "10% Preferred Return").

         Generally,  net  sales  proceeds  from the sale of  properties,  to the
         extent  distributed,  will be distributed first to the limited partners
         in an  amount  sufficient  to  provide  them with  their 10%  Preferred
         Return,  plus the return of their adjusted capital  contributions.  The
         general   partners  will  then  receive,   to  the  extent   previously
         subordinated   and  unpaid,   a  one  percent  interest  in  all  prior
         distributions   of  net  cash  flow  and  a  return  of  their  capital
         contributions.  Any remaining  sales  proceeds will be  distributed  95
         percent  to the  limited  partners  and  five  percent  to the  general
         partners.  Any  gain  from  the  sale of a  property  is,  in  general,
         allocated in the same manner as net sales  proceeds are  distributable.
         Any loss from the sale of a property is, in general,  allocated  first,
         on a pro rata  basis,  to  partners  with  positive  balances  in their
         capital  accounts;  and thereafter,  95 percent to the limited partners
         and five percent to the general partners.

         During the year ended  December  31,  1997,  the  Partnership  declared
         distributions  to the limited partners of $3,600,003 and during each of
         the years ended  December 31, 1996 and 1995, the  Partnership  declared
         distributions to the limited  partners of $3,640,003.  No distributions
         have been made to the general partners to date.


                                       27

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995

8.       Income Taxes:

         The following is a reconciliation of net income for financial reporting
         purposes to net income for federal  income tax  purposes  for the years
         ended December 31:
<TABLE>
<CAPTION>

                                                                1997             1996              1995
                                                             ----------       ----------        -------
<S> <C>
                  Net income for
                    financial reporting
                    purposes                                 $3,531,381       $3,461,812        $3,552,067

                  Depreciation for tax
                    reporting purposes
                    in excess of
                    depreciation for
                    financial reporting
                    purposes                                   (289,098)        (298,518)         (304,027)

                  Direct financing leases
                    recorded as operating
                    leases for tax
                    reporting purposes                          211,942          160,007           141,684

                  Equity in earnings of
                    unconsolidated joint
                    ventures for tax
                    reporting purposes
                    in excess of equity
                    in earnings of
                    unconsolidated joint
                    ventures for financial
                    reporting purposes                           15,294           10,839            12,592

                  Gain on sale of land
                    and building for
                    financial reporting
                    purposes in excess
                    of gain for tax
                    reporting purposes                          (42,996)              -            (16,395)

                  Allowance for doubtful
                    accounts                                    133,428               -                 -

                  Accrued rental income                        (201,022)        (315,029)         (309,574)

                  Rents paid in advance                         (22,593)          45,447           (80,403)

                  Minority interest in
                    timing differences
                    of consolidated
                    joint venture                                 1,461            2,184             2,062

                  Other                                              -            (7,738)            9,613
                                                             ----------       ----------        ----------

                  Net income for federal
                    income tax purposes                      $3,337,797       $3,059,004        $3,007,619
                                                             ==========       ==========        ==========
</TABLE>

                                       28

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


9.       Related Party Transactions:

         One of the individual general partners, James M. Seneff, Jr., is one of
         the principal  shareholders  of CNL Group,  Inc., the parent company of
         CNL Fund Advisors, Inc. The other individual general partner, Robert A.
         Bourne, served as president of CNL Fund Advisors,  Inc. through October
         1997. CNL Income Fund Advisors,  Inc. was a wholly owned  subsidiary of
         CNL Group,  Inc. until its merger,  effective January 1, 1996, with CNL
         Fund Advisors,  Inc. During the years ended December 31, 1997, 1996 and
         1995,  CNL Income  Fund  Advisors,  Inc.  and CNL Fund  Advisors,  Inc.
         (hereinafter   referred  to  collectively  as  the  "Affiliates")  each
         performed certain services for the Partnership, as described below.

         During  the years  ended  December  31,  1997,  1996 and 1995,  certain
         Affiliates acted as manager of the Partnership's properties pursuant to
         a management agreement with the Partnership.  In connection  therewith,
         the Partnership agreed to pay the Affiliates an annual,  noncumulative,
         subordinated management fee of one percent of the sum of gross revenues
         from properties  wholly owned by the Partnership and the  Partnership's
         allocable  share of gross  revenues  from  joint  ventures,  but not in
         excess of competitive fees for comparable services.  These fees will be
         incurred  and will be payable only after the limited  partners  receive
         their  10%  Preferred  Return.  Due to the  fact  that  these  fees are
         noncumulative,  if the  limited  partners  do  not  receive  their  10%
         Preferred Return in any particular year, no management fees will be due
         or payable for such year. As a result of such threshold,  no management
         fees were incurred  during the years ended December 31, 1997,  1996 and
         1995.

         Certain   Affiliates   are  also   entitled   to  receive  a  deferred,
         subordinated real estate  disposition fee, payable upon the sale of one
         or more  properties  based on the lesser of one-half  of a  competitive
         real  estate  commission  or three  percent  of the sales  price if the
         Affiliates  provide a substantial amount of services in connection with
         the  sale.  However,  if the net sales  proceeds  are  reinvested  in a
         replacement  property,  no such real  estate  disposition  fees will be
         incurred  until  such  replacement  property  is sold and the net sales
         proceeds are distributed.  In addition, the real estate disposition fee
         is subordinated  to receipt by the limited  partners of their aggregate
         10% Preferred  Return,  plus their adjusted capital  contributions.  No
         deferred,  subordinated real estate disposition fees have been incurred
         since inception.

                                       29

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


9.       Related Party Transactions - Continued:

         During the years ended December 31, 1997, 1996 and 1995, the Affiliates
         provided accounting and administrative services to the Partnership on a
         day-to-day basis. The Partnership incurred $87,967, $94,496 and $76,108
         for the years ended December 31, 1997, 1996 and 1995, respectively, for
         such services.

         The due to related  parties at  December  31,  1997 and 1996,  totalled
         $4,946 and $1,609, respectively.

         During 1997, the  Partnership  acquired a property for a purchase price
         of $1,277,300 from CNL BB Corp., an affiliate of the general  partners.
         CNL BB Corp. had purchased and temporarily  held title to this property
         in  order  to  facilitate  the  acquisition  of  the  property  by  the
         Partnership. The purchase price paid by the Partnership represented the
         costs  incurred  by CNL BB Corp.  to  acquire  and carry the  property,
         including closing costs.

10.      Concentration of Credit Risk:

         The  following  schedule  presents  total rental and earned income from
         individual lessees, or affiliated groups of lessees,  each representing
         more than ten  percent  of the  Partnership's  total  rental and earned
         income  (including the  Partnership's  share of total rental and earned
         income from  unconsolidated  joint ventures and the properties  held as
         tenants-in-common with affiliates), for at least one of the years ended
         December 31:
<TABLE>
<CAPTION>

                                                                 1997             1996              1995
                                                               --------         --------          ------
<S> <C>

                  Foodmaker, Inc.                              $646,477         $684,277          $686,417
                  Flagstar Enterprises,
                    Inc. and Denny's,
                    Inc.                                        602,913          668,919           674,611
                  Golden Corral
                    Corporation                                 548,399          568,164           567,654
</TABLE>

                                       30

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


10.      Concentration of Credit Risk - Continued:

         In addition,  the following  schedule  presents total rental and earned
         income from individual  restaurant chains,  each representing more than
         ten  percent  of the  Partnership's  total  rental  and  earned  income
         (including  the  Partnership's  share of total rental and earned income
         from   unconsolidated   joint  ventures  and  the  properties  held  as
         tenants-in-common  with affiliates) for at least one of the years ended
         December 31:
<TABLE>
<CAPTION>

                                                                 1997             1996              1995
                                                               --------         --------          ------
<S> <C>
                  Burger King                                  $777,378         $714,792          $721,870
                  Jack in the Box                               646,477          684,277           686,417
                  Golden Corral Family
                    Steakhouse
                    Restaurants                                 548,399          568,164           567,654
                  Shoney's                                      441,052          439,330           354,457
                  Hardees                                       403,882          468,037           471,507
                  Perkins                                       336,983          393,046           449,149
</TABLE>

         Although  the  Partnership's   properties  are  geographically  diverse
         throughout the United States and the  Partnership's  lessees  operate a
         variety of restaurant concepts,  default by any one of these lessees or
         restaurant chains could significantly  impact the results of operations
         of the Partnership. However, the general partners believe that the risk
         of such a default is reduced due to the  essential or important  nature
         of these properties for the on-going operations of the lessees.

11.      Commitments and Contingencies:

         In October 1995, the tenant of the  Partnership's  property  located in
         Austin, Texas, entered into a sublease agreement for a vacant parcel of
         land under which the  subtenant  has the option to purchase  such land.
         The subtenant  exercised the purchase option and in accordance with the
         terms of the  sublease  agreement,  the tenant  assigned  the  purchase
         contract,  together with the purchase contract payment of $69,000, from
         the subtenant,  to the  Partnership.  As of December 31, 1997, the sale
         for the vacant parcel of land had not been consummated and as a result,
         the net proceeds of $68,000 (representing the original $69,000 received
         by the  Partnership,  less $1,000 in costs incurred in  anticipation of
         the sale) were recorded as a deposit at December 31, 1997. The contract
         price of $69,000  exceeds the  Partnership's  cost  attributable to the
         parcel of land.

                                       31

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 1997, 1996 and 1995


12.      Subsequent Event:

         During  1997,  the  Partnership  entered  into a  contract  to sell the
         property in Sacramento,  California to the tenant. In January 1998, the
         Partnership  sold this property for  $1,250,000  and received net sales
         proceeds of $1,234,175,  resulting in a gain of approximately  $163,300
         for financial reporting  purposes.  The Partnership intends to reinvest
         the net sales proceeds in a replacement property.

                                       32

<PAGE>



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

         None.


                                    PART III


Item 10.  Directors and Executive Officers of the Registrant

         The General Partners of the Registrant are James M. Seneff, Jr., Robert
A.  Bourne  and CNL  Realty  Corporation,  a Florida  corporation.  The  General
Partners  manage  and  control  the  Partnership's   affairs  and  have  general
responsibility   and  the  ultimate  authority  in  all  matters  affecting  the
Partnership's  business.  The  Partnership  has  available  to it the  services,
personnel and experience of CNL Fund Advisors,  Inc., CNL Group,  Inc. and their
affiliates, all of which are affiliates of the General Partners.

         James M. Seneff, Jr., age 51, is a principal  stockholder of CNL Group,
Inc., a diversified  real estate company,  and has served as its Chairman of the
Board of Directors,  director and Chief Executive Officer since its formation in
1980.  CNL Group,  Inc.  is the  parent  company of CNL  Securities  Corp.,  CNL
Investment Company, CNL Fund Advisors,  Inc., CNL Real Estate Advisors, Inc. and
prior to its merger with CNL Fund Advisors, Inc., effective January 1, 1996, CNL
Income Fund Advisors, Inc. Mr. Seneff is Chief Executive Officer, and has been a
director and registered  principal of CNL Securities Corp.,  which served as the
managing dealer in the Partnership's  offering of Units,  since its formation in
1979.  Mr.  Seneff also has held the position of President and a director of CNL
Management  Company,  a registered  investment  advisor,  since its formation in
1976,  has served as Chief  Executive  Officer and  Chairman of the Board of CNL
Investment  Company,  and Chief  Executive  Officer and Chairman of the Board of
Commercial Net Lease Realty,  Inc. since 1992, has served as the Chairman of the
Board and the Chief  Executive  Officer of CNL Realty  Advisors,  Inc. since its
inception in 1991 through  December 31, 1997, at which time CNL Realty Advisors,
Inc.  merged with Commercial Net Lease Realty,  Inc.,  served as Chairman of the
Board and Chief  Executive  Officer of CNL Income Fund Advisors,  Inc. since its
inception in 1994 through December 31, 1995, has served as a director,  Chairman
of the Board and Chief  Executive  Officer of CNL Fund Advisors,  Inc. since its
inception in 1994,  and has held the position of Chief  Executive  Officer and a
director of CNL Institutional  Advisors,  Inc., a registered investment advisor,
since its inception in 1990.  In addition,  Mr. Seneff has served as a director,
Chairman of the Board and Chief  Executive  Officer of CNL  American  Properties
Fund,  Inc. since 1994, and has served as a director,  Chairman of the Board and
Chief Executive  Officer of CNL American Realty Fund, Inc. since 1996 and of CNL
Real Estate Advisors,  Inc. since January 1997. Mr. Seneff  previously served on
the Florida State  Commission on Ethics and is a former member and past Chairman
of the State of Florida  Investment  Advisory  Council,  which recommends to the
Florida  Board  of  Administration  investments  for  various  Florida  employee
retirement  funds.  The Florida  Board of  Administration,  Florida's  principal
investment advisory and money management agency, oversees the investment of more
than $60 billion of retirement funds.  Since 1971, Mr. Seneff has been active in
the  acquisition,  development  and  management  of real  estate  projects  and,
directly or through an  affiliated  entity,  has served as a general  partner or
joint  venturer in over 100 real  estate  ventures  involved  in the  financing,
acquisition,  construction and rental of office buildings,  apartment complexes,
restaurants,  hotels  and other  real  estate.  Included  in these  real  estate
ventures are approximately 65 privately offered real estate limited partnerships
in which Mr.  Seneff,  directly or through an affiliated  entity,  serves or has
served as a general partner. Also included are CNL Income Fund, Ltd., CNL Income
Fund II, Ltd.,  CNL Income Fund III,  Ltd., CNL Income Fund IV, Ltd., CNL Income
Fund V, Ltd.,  CNL Income Fund VI, Ltd.,  CNL Income Fund VII,  Ltd., CNL Income
Fund VIII,  Ltd., CNL Income Fund IX, Ltd., CNL Income Fund XI, Ltd., CNL Income
Fund XII,  Ltd.,  CNL Income Fund XIII,  Ltd.,  CNL Income Fund XIV,  Ltd.,  CNL
Income Fund XV, Ltd., CNL Income Fund XVI, Ltd., CNL Income Fund XVII,  Ltd. and
CNL Income Fund XVIII,  Ltd. (the "CNL Income Fund  Partnerships"),  public real
estate limited  partnerships with investment  objectives similar to those of the
Partnership,  in which  Mr.  Seneff  serves  as a general  partner.  Mr.  Seneff
received his degree in Business  Administration from Florida State University in
1968.


                                       33

<PAGE>



         Robert A.  Bourne,  age 50, is  President  and  Treasurer of CNL Group,
Inc., President,  a director and a registered principal of CNL Securities Corp.,
President and a director of CNL Investment Company, and prior to its merger with
CNL Fund Advisors,  Inc.,  effective  January 1, 1996, CNL Income Fund Advisors,
Inc., and Chief Investment Officer,  Vice Chairman of the Board of Directors,  a
director  and  Treasurer  of CNL  Institutional  Advisors,  Inc.,  a  registered
investment  advisor.  Mr.  Bourne  served  as  President  of  CNL  Institutional
Advisors,  Inc. from the date of its inception  through June 30, 1997 and served
as President of CNL Fund Advisors,  Inc. from the date of its inception  through
October 1997.  Mr. Bourne also has served as a director since 1992, as President
from July 1992 to February  1996, as Secretary and Treasurer  from February 1996
through  December 1997, and since February 1996,  served as Vice Chairman of the
Board of Directors of Commercial Net Lease Realty, Inc. In addition,  Mr. Bourne
has served as a director  since its inception in 1991, as President from 1991 to
February  1996, as Secretary from February 1996 to July 1996, and since February
1996, served as Treasurer and Vice Chairman of CNL Realty Advisors, Inc. through
December  31,  1997,  at which  time  CNL  Realty  Advisors,  Inc.  merged  with
Commercial  Net Lease  Realty,  Inc.  In  addition,  Mr.  Bourne  has  served as
President and a director of CNL American  Properties  Fund, Inc. since 1994, and
has served as President and a director of CNL American  Realty Fund,  Inc. since
1996 and of CNL Real Estate  Advisors,  Inc. since January 1997. Upon graduation
from Florida State  University in 1970,  where he received a B.A. in Accounting,
with honors,  Mr.  Bourne  worked as a certified  public  accountant  and,  from
September  1971  through  December  1978,  was  employed  by  Coopers & Lybrand,
Certified  Public  Accountants,  where  he  held  the  position  of tax  manager
beginning in 1975.  From January 1979 until June 1982,  Mr. Bourne was a partner
in the  accounting  firm of Cross & Bourne  and from July 1982  through  January
1987, he was a partner in the accounting firm of Bourne & Rose, P.A.,  Certified
Public  Accountants.  Mr. Bourne,  who joined CNL Securities  Corp. in 1979, has
participated  as a general  partner or joint  venturer  in over 100 real  estate
ventures  involved in the  financing,  acquisition,  construction  and rental of
office  buildings,  apartment  complexes,  restaurants,  hotels  and other  real
estate.  Included in these real estate ventures are  approximately  64 privately
offered  real  estate  limited  partnerships  in which Mr.  Bourne,  directly or
through an affiliated  entity,  serves or has served as a general partner.  Also
included  are the CNL Income  Fund  Partnerships,  public  real  estate  limited
partnerships with investment objectives similar to those of the Partnership,  in
which Mr. Bourne serves as a general partner.

         CNL Realty Corporation is a corporation organized on November 26, 1985,
under the laws of the State of Florida.  Its sole directors and shareholders are
James M. Seneff, Jr. and Robert A. Bourne, the individual General Partners.  CNL
Realty  Corporation  was organized to serve as the corporate  general partner of
real estate limited partnerships,  such as the Partnership,  organized by one or
both of the individual General Partners. CNL Realty Corporation currently serves
as the corporate general partner of the CNL Income Fund Partnerships.

         CNL  Fund  Advisors,  Inc.  provides  certain  management  services  in
connection with the Partnership and its Properties. CNL Fund Advisors, Inc. is a
corporation  organized  in 1994 under the laws of the State of Florida,  and its
principal  office is located at 400 East South Street,  Orlando,  Florida 32801.
CNL Fund  Advisors,  Inc. is a wholly  owned  subsidiary  of CNL Group,  Inc., a
diversified  real  estate  company,   and  was  organized  to  perform  property
acquisition, property management and other services.

         CNL  Group,  Inc.,  which is the parent  company of CNL Fund  Advisors,
Inc.,  was organized in 1980 under the laws of the State of Florida.  CNL Group,
Inc. is a diversified  real estate  company which  provides a wide range of real
estate,  development  and  financial  services to companies in the United States
through the  activities  of its  subsidiaries.  These  activities  are primarily
focused  on the  franchised  restaurant  and  hospitality  industries.  James M.
Seneff,  Jr., an individual General Partner of the Partnership,  is the Chairman
of the Board,  Chief Executive  Officer,  and a director of CNL Group,  Inc. Mr.
Seneff and his wife own all of the outstanding shares of CNL Group, Inc.

         The following persons serve as operating officers of CNL Group, Inc. or
its affiliates or  subsidiaries  in the discretion of the Boards of Directors of
those companies,  but, except as specifically indicated, do not serve as members
of the Boards of Directors of those  entities.  The Boards of Directors have the
responsibility for creating and implementing the policies of CNL Group, Inc. and
its affiliated companies.



                                       34

<PAGE>



         Curtis B. McWilliams,  age 42, joined CNL Fund Advisors,  Inc. in April
1997 and  currently  serves  as  President  of CNL Fund  Advisors,  Inc.  and as
Executive Vice President of CNL American Properties Fund, Inc. In addition,  Mr.
McWilliams  serves  as  Executive  Vice  President  of CNL  Group,  Inc.  and as
President of CNL Financial Services,  Inc. and certain other subsidiaries of CNL
Group,  Inc. From September 1983 through March 1997, Mr. McWilliams was employed
by Merrill  Lynch.  From  January  1991 to August  1996,  Mr.  McWilliams  was a
managing director in the corporate  banking group of Merrill Lynch's  investment
banking division.  During this time, he was a senior  relationship  manager with
Merrill  Lynch and as such was  responsible  for a number of the  firm's  larger
clients.  From February 1990 to February  1993, he also served as co-head of one
of the  Industrial  Banking  Groups within Merrill  Lynch's  investment  banking
division and had administrative responsibility for a group of bankers and client
relationships, including the firm's transportation group. From September 1996 to
March  1997,  Mr.  McWilliams  served as  Chairman  of Merrill  Lynch's  Private
Advisory Services. Mr. McWilliams received a B.S.E. in Chemical Engineering from
Princeton  University  in 1977 and a Masters of Business  Administration  with a
concentration in finance from the University of Chicago in 1983.

         John T. Walker,  age 39, is the Chief  Operating  Officer and Executive
Vice President of CNL Fund Advisors, Inc. and CNL American Properties Fund, Inc.
and serves as Executive Vice President of CNL American Realty Fund, Inc. and CNL
Real Estate  Advisors,  Inc. From May 1992 to May 1994,  he was  Executive  Vice
President for Finance and Administration and Chief Financial Officer of Z Music,
Inc., a cable  television  network  which was  subsequently  acquired by Gaylord
Entertainment, where he was responsible for overall financial and administrative
management  and planning.  From January 1990 through April 1992,  Mr. Walker was
Chief Financial  Officer of the First Baptist Church in Orlando,  Florida.  From
April 1984 through  December  1989, he was a partner in the  accounting  firm of
Chastang,  Ferrell & Walker,  P.A.,  where he was the partner in charge of audit
and  consulting  services,  and  from  1981 to  1984,  Mr.  Walker  was a Senior
Consultant/Audit Senior at Price Waterhouse.  Mr. Walker is a Cum Laude graduate
of Wake Forest  University with a B.S. in Accountancy and is a certified  public
accountant.

         Lynn E. Rose,  age 49, a  certified  public  accountant,  has served as
Chief  Financial  Officer of CNL Group,  Inc. since December 1993, has served as
Secretary of CNL Group,  Inc. since 1987, and served as Controller of CNL Group,
Inc. from 1987 until  December  1993. In addition,  Ms. Rose has served as Chief
Financial Officer and Secretary of CNL Securities Corp. since July 1994. She has
served as Chief Operating Officer, Vice President and Secretary of CNL Corporate
Services,  Inc. since November 1994. Ms. Rose also has served as Chief Financial
Officer and Secretary of CNL Institutional Advisors, Inc. since its inception in
1990, served as a director and Secretary of CNL Realty Advisors,  Inc. since its
inception in 1991 through  December 31, 1997, at which time CNL Realty Advisors,
Inc.  merged with  Commercial  Net Lease Realty,  Inc.,  Treasurer of CNL Realty
Advisors, Inc. from 1991 to February 1996, Secretary and Treasurer of Commercial
Net Lease Realty, Inc. from 1992 to February 1996,  Secretary of CNL Income Fund
Advisors,  Inc.  since its inception in 1994 to December  1995,  and a director,
Secretary and Treasurer of CNL Fund Advisors,  Inc. since 1994 and has served as
a director,  Secretary and  Treasurer of CNL Real Estate  Advisors,  Inc.  since
January  1997.  Ms.  Rose also has  served as  Secretary  and  Treasurer  of CNL
American  Properties  Fund,  Inc.  since 1994,  and has served as Secretary  and
Treasurer of CNL American  Realty Fund, Inc. since 1996. Ms. Rose also currently
serves as Secretary  for  approximately  50  additional  corporations.  Ms. Rose
oversees the management information services, administration,  legal compliance,
accounting,   tenant  compliance,  and  reporting  for  over  300  corporations,
partnerships,  and joint ventures.  Prior to joining CNL, Ms. Rose was a partner
with Robert A. Bourne in the accounting firm of Bourne & Rose,  P.A.,  Certified
Public  Accountants.  Ms. Rose holds a B.A. in Sociology  from the University of
Central Florida. She was licensed as a certified public accountant in 1979.



                                       35

<PAGE>



         Jeanne A. Wall,  age 39, has served as Chief  Operating  Officer of CNL
Investment  Company and of CNL  Securities  Corp.  since  November  1994 and has
served as Executive Vice President of CNL Investment Company since January 1991.
In 1984,  Ms. Wall joined CNL  Securities  Corp.  In 1985,  Ms. Wall became Vice
President of CNL Securities Corp., in 1987, she became Senior Vice President and
in July 1997, she became  Executive  Vice  President of CNL Securities  Corp. In
this  capacity,  Ms. Wall serves as national  marketing  and sales  director and
oversees  the  national  marketing  plan  for the CNL  investment  programs.  In
addition, Ms. Wall oversees product development,  partnership administration and
investor  services for  programs  offered  through  participating  brokers,  and
corporate  communications for CNL Group, Inc. and Affiliates.  Ms. Wall also has
served  as  Senior  Vice  President  of  CNL  Institutional  Advisors,  Inc.,  a
registered  investment  advisor,  from 1990 to 1993,  as Vice  President  of CNL
Realty  Advisors,  Inc.  since  its  inception  in 1991  through  1997,  as Vice
President of  Commercial  Net Lease  Realty,  Inc.  from 1992 through  1997,  as
Executive Vice President of CNL Fund Advisors, Inc. since 1994, and as Executive
Vice President of CNL American  Properties  Fund,  Inc. since 1994. In addition,
Ms. Wall has served as Executive  Vice  President  of CNL Real Estate  Advisors,
Inc. since January 1997 and as Executive  Vice President of CNL American  Realty
Fund,  Inc.  since 1996. Ms. Wall holds a B.A. in Business  Administration  from
Linfield College and is a registered  principal of CNL Securities Corp. Ms. Wall
currently serves as a trustee on the board of the Investment Program Association
and on the Direct  Participation  Program committee for the National Association
of Securities Dealers (NASD).

         Steven D. Shackelford, age 34, has served as Chief Financial Officer of
CNL Fund Advisors,  Inc. since September 1996 and as Chief Financial  Officer of
CNL American  Properties  Fund, Inc. since January 1997. From March 1995 to July
1996, he was a senior manager in the national office of Price  Waterhouse  where
he was responsible  for advising  foreign clients seeking to raise capital and a
public listing in the United  States.  From August 1992 to March 1995, he served
as a manager in the Price  Waterhouse,  Paris,  France  office  serving  several
multinational  clients. Mr. Shackelford was an audit staff and audit senior from
1986 to 1992 in the Orlando, Florida office of Price Waterhouse.  Mr Shackelford
received  a  B.A.  in  Accounting,  with  honors,  and  a  Masters  of  Business
Administration   from  Florida  State  University  and  is  a  certified  public
accountant.


Item 11.  Executive Compensation

         Other than as  described in Item 13, the  Partnership  has not paid and
does not intend to pay any executive compensation to the General Partners or any
of their affiliates.  There are no compensatory plans or arrangements  regarding
termination of employment or change of control.


Item 12.  Security Ownership of Certain Beneficial Owners and Management

         As of February 28, 1998, no person was known to the  Registrant to be a
beneficial owner of more than five percent of the Units.

         The following table sets forth, as of February 28, 1998, the beneficial
ownership interests of the General Partners in the Registrant.

<TABLE>
<CAPTION>

                 Title of Class                      Name of Partner                       Percent of Class
<S> <C>
         General Partnership Interests               James M. Seneff, Jr.                         45%
                                                     Robert A. Bourne                             45%
                                                     CNL Realty Corporation                       10%
                                                                                                 ----
                                                                                                 100%
</TABLE>

         Neither the General  Partners,  nor any of their  affiliates,  owns any
interest in the  Registrant,  except as noted above.  There are no  arrangements
which at a subsequent date may result in a change in control of the Registrant.



                                       36

<PAGE>



Item 13.  Certain Relationships and Related Transactions

         The  table  below   summarizes  the  types,   recipients,   methods  of
computation and amounts of compensation,  fees and distributions paid or payable
by the  Partnership  to the General  Partners and their  affiliates for the year
ended  December 31, 1997,  exclusive of any  distributions  to which the General
Partners or their  affiliates  may be entitled by reason of their  purchase  and
ownership of Units.
<TABLE>
<CAPTION>

==========================================================================================================================
                                                                                              Amount Incurred
         Type of Compensation                                                                  For the Year
              and Recipient                       Method of Computation                   Ended December 31, 1997
        -----------------------                   ---------------------                   -----------------------
<S> <C>
Reimbursement  to affiliates             Operating expenses are reimbursed        Operating expenses incurred on
for operating expenses                   at the lower of cost or 90 percent       behalf of the Partnership:
                                         behalf of the Partnership:               $86,327
                                         of the prevailing rate at which          
                                         comparable services could have
                                         been obtained in the same
                                         geographic area.  Affiliates of the
                                         General Partners from time to
                                         time incur certain operating             Accounting and administrative
                                         expenses on behalf of the                services:  $87,967
                                         Partnership for which the
                                         Partnership reimburses the
                                         affiliates without interest.

Annual, subordinated  manage-            One percent of the sum of gross          $ - 0 -
ment fee to affiliates                   operating revenues from
                                         Properties    wholly   owned   by   the
                                         Partnership   plus  the   Partnership's
                                         allocable  share of gross  revenues  of
                                         joint ventures in which the Partnership
                                         is  a  co-venturer,   subordinated   to
                                         certain  minimum returns to the Limited
                                         Partners.  The  management fee will not
                                         exceed  competitive fees for comparable
                                         services.  Due to the fact  that  these
                                         fees are non-cumulative, if the Limited
                                         Partners  do  not  receive   their  10%
                                         Preferred   Return  in  any  particular
                                         year, no management fees will be due or
                                         payable for such year.

==========================================================================================================================
</TABLE>










                                       37

<PAGE>






<TABLE>
<CAPTION>

==========================================================================================================================
                                                                                              Amount Incurred
         Type of Compensation                                                                  For the Year
              and Recipient                       Method of Computation                   Ended December 31, 1997
        -----------------------                   ---------------------                   -----------------------
<S> <C>
Deferred, subordinated real estate       A deferred, subordinated real               $ - 0 -
disposition fee payable to               estate disposition fee, payable
affiliates                               upon sale of one or more
                                         Properties,  in an amount  equal to the
                                         lesser of (i) one-half of a competitive
                                         real estate  commission,  or (ii) three
                                         percent  of the  sales  price  of  such
                                         Property or Properties. Payment of such
                                         fee shall be made only if affiliates of
                                         the   General    Partners   provide   a
                                         substantial   amount  of   services  in
                                         connection  with the sale of a Property
                                         or Properties and shall be subordinated
                                         to  certain   minimum  returns  to  the
                                         Limited Partners.  However,  if the net
                                         sales  proceeds  are  reinvested  in  a
                                         replacement   Property,  no  such  real
                                         estate disposition fee will be incurred
                                         until such replacement Property is sold
                                         and  the   net   sales   proceeds   are
                                         distributed.

General Partners' deferred, sub-         A deferred, subordinated share             $ - 0 -
ordinated share of Partnership net       equal to one percent of
cash flow                                Partnership distributions of net
                                         cash flow, subordinated to certain
                                         minimum returns to the Limited
                                         Partners.

General Partners' deferred, sub-         A deferred, subordinated share              $ - 0 -
ordinated share of Partnership net       equal to five percent of
sales proceeds from a sale or            Partnership distributions of such
sales                                    net sales proceeds, subordinated to
                                         certain minimum returns to the
                                         Limited Partners.


==========================================================================================================================
</TABLE>








                                       38

<PAGE>



                                     PART IV


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

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

         1.  Financial Statements

                  Report of Independent Accountants

                  Balance Sheets at December 31, 1997 and 1996

                  Statements  of Income for the years ended  December  31, 1997,
                  1996 and 1995

                  Statements of Partners'  Capital for the years ended  December
                  31, 1997, 1996 and 1995

                  Statements  of Cash  Flows for the years  ended  December  31,
                  1997, 1996 and 1995

                  Notes to Financial Statements

         2.  Financial Statement Schedule

                  Schedule II - Valuation and Qualifying  Accounts for the years
                  ended December 31, 1997, 1996 and 1995

                  Schedule  III - Real Estate and  Accumulated  Depreciation  at
                  December 31, 1997

                  Notes  to  Schedule   III  -  Real   Estate  and   Accumulated
                  Depreciation at December 31, 1997

                  All other Schedules are omitted as the required information is
                  inapplicable  or is presented in the  financial  statements or
                  notes thereto.

         3.  Exhibits

                  3.1      Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund X, Ltd.  (Included  as Exhibit 3.2 to
                           Registration  Statement No. 33-35049 on Form S-11 and
                           incorporated herein by reference.)

                  4.1      Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund X, Ltd.  (Included  as Exhibit 3.2 to
                           Registration  Statement No. 33-35049 on Form S-11 and
                           incorporated herein by reference.)

                  4.2      Amended and Restated Agreement of Limited Partnership
                           of CNL Income Fund X, Ltd.  (Included  as Exhibit 3.3
                           to  Post-Effective  Amendment  No. 4 to  Registration
                           Statement No. 33-35049 on Form S-11 and  incorporated
                           herein by reference.)

                  10.1     Management  Agreement between CNL Income Fund X, Ltd.
                           and CNL Investment Company (Filed herewith.)

                  10.2     Assignment   of   Management   Agreement   from   CNL
                           Investment Company to CNL Income Fund Advisors,  Inc.
                           (Included as Exhibit 10.2 to Form 10-K filed with the
                           Securities and Exchange Commission on March 30, 1995,
                           and incorporated herein by reference.)


                                       39

<PAGE>



                  10.3     Assignment  of Management  Agreement  from CNL Income
                           Fund  Advisors,  Inc.  to  CNL  Fund  Advisors,  Inc.
                           (Included as Exhibit 10.3 to Form 10-K filed with the
                           Securities and Exchange  Commission on April 1, 1996,
                           and incorporated herein by reference)

                  27       Financial Data Schedule (Filed herewith.)

         (b)      The Registrant  filed no reports on Form 8-K during the period
                  October 1, 1997 through December 31, 1997.

                                       40

<PAGE>



                                   SIGNATURES


         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the  undersigned,  thereunto duly  authorized,  on the 13th day of
March, 1998.

                                 CNL INCOME FUND X, LTD.

                                 By:      CNL REALTY CORPORATION
                                          General Partner

                                          /s/ Robert A. Bourne
                                          -----------------------------
                                          ROBERT A. BOURNE, President


                                 By:      ROBERT A. BOURNE
                                          General Partner

                                          /s/ Robert A. Bourne
                                          -----------------------------
                                          ROBERT A. BOURNE


                                 By:      JAMES M. SENEFF, JR.
                                          General Partner

                                          /s/ James M. Seneff, Jr.
                                          ---------------------------------
                                          JAMES M. SENEFF, JR.      

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

<TABLE>
<CAPTION>

Signature                                      Title                                Date
<S> <C>
/s/ Robert A. Bourne                President, Treasurer and Director           March 13, 1998
----------------------------        (Principal Financial and Accounting
Robert A. Bourne                    Officer)
                                                  

/s/ James M. Seneff, Jr.            Chief Executive Officer and Director        March 13, 1998
----------------------------        (Principal Executive Officer)
James M. Seneff, Jr.

</TABLE>


<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                  Years Ended December 31, 1997, 1996 and 1995

<TABLE>
<CAPTION>


                                                                 Additions                      Deductions
                                                                                                          Collected
                                                                                                          or Deter-
                                    Balance at        Charged to         Charged to        Deemed         mined to        Balance
                                     Beginning         Costs and           Other          Uncollec-        be Col-        at End
Year     Description                  of Year          Expenses           Accounts          tible         lectible        of Year
----     -----------                ----------        ----------        -----------       ---------       ---------      --------
<S> <C>

1995     Allowance for
           doubtful
           accounts (a)             $  2,555          $     -            $ 20,271(b)     $  9,533        $  1,126        $ 12,167
                                    ========          ========           ========        ========        ========        ========


1996     Allowance for
           doubtful
           accounts (a)             $ 12,167          $     -            $ 91,857(b)     $ 10,368        $    447        $ 93,209
                                    ========          ========           ========        ========        ========        ========


1997  Allowance for
        doubtful
        accounts (a)                $ 93,209          $     -            $192,212(b)     $  5,083        $ 24,889        $255,449
                                    ========          ========           ========        ========        ========        ========
</TABLE>


         (a) Deducted from  receivables and accrued rental income on the balance
             sheet.

         (b) Reduction of rental, earned and other income.

         (c) Amounts written off as uncollectible.

                                       F-1

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

             SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

                                December 31, 1997

<TABLE>
<CAPTION>


                                                                                                     Costs Capitalized
                                                                                                         Subsequent
                                                                              Initial Cost             To Acquisition
                                                                                Buildings
                                              Encum-                              and             Improve-      Carrying
                                             brances           Land           Improvements         ments         Costs
<S> <C>
Properties the Partnership
  has Invested in Under
  Operating Leases:

    Boston Market:
      Homewood, Alabama                           -          $  597,907         $  679,400        $      -      $     -

    Burger King Restaurants:
      Hendersonville, North Carolina              -             222,632                 -                -            -
      Irondequoit, New York                       -             383,359                 -                -            -

    Denny's Restaurants:
      Fremont, Ohio                               -             160,896                 -           273,700           -
      Detroit, Michigan                           -             285,842                 -                -            -
      Spartanburg, South Carolina                 -             287,959                 -                -            -

    Golden Corral Family
      Steakhouse Restaurants:
        Austin, Texas                             -             653,462                 -         1,106,384           -
        Austin, Texas                             -             711,354                 -         1,124,040           -
        Las Cruces, New Mexico                    -             580,655            920,521               -            -

    Hardee's Restaurants:
      Pace, Florida                               -             174,850                 -                -            -
      Jacksonville, Florida                       -             326,972                 -                -            -
      Centerville, Tennessee                      -             130,494                 -                -            -

    Jack in the Box Restaurants:
      Sacramento, California                      -             448,491                 -                -            -
      Desloge, Missouri                           -             276,701                 -                -            -
      San Antonio, Texas                          -             327,322                 -                -            -
      Missouri City, Texas                        -             348,646                 -                -            -
      Pasadena, Texas                             -             202,393                 -                -            -

    Long John Silver's Restaurants:
      Alamogordo, New Mexico                      -             157,401                 -                -            -
      Las Cruces, New Mexico                      -             222,778                 -                -            -

    Perkins Restaurants:
      Lancaster, New York                         -             336,872                 -                -            -
      Ft. Pierce, Florida                         -             487,752                 -           567,923           -
      Amherst, New York                           -             507,648                 -                -            -
</TABLE>


<PAGE>










<TABLE>
<CAPTION>

                                                                                                                         Life
                                                                                                                       on Which
                                        Gross Amount at Which Carried                                               Depreciation
                                                at Close of Period (c)                                                in Latest
                            Buildings                                                  Date                             Income
                               and                                Accumulated         of Con-          Date          Statement is
           Land            Improvements           Total           Depreciation       struction       Acquired          Computed
        ----------         ------------        -----------        ------------       ---------       --------        ----------

<S> <C>




        $  597,907           $  679,400        $ 1,277,307            $  4,322          1997            10/97            (b)


           222,632               (f)               222,632                  -           1986            11/91         (d)
           383,359               (f)               383,359                  -           1986            11/91         (d)


           160,896           $  273,700            434,596              39,030          1992            12/91            (g)
           285,842               (f)               285,842                  -           1992            02/92         (d)
           287,959               (f)               287,959                  -           1992            03/92         (d)



           653,462            1,106,384          1,759,846             213,699          1992            12/91            (b)
           711,354            1,124,040          1,835,394             210,232          1992            12/91            (b)
           580,655              920,521          1,501,176             173,428          1992            05/92            (b)


           174,850               (f)               174,850                  -           1992            01/92         (d)
           326,972               (f)               326,972                  -           1990            02/92         (d)
           130,494               (f)               130,494                  -           1991            02/92         (d)
 

           448,491               (f)               448,491                  -           1991            12/91         (d)
           276,701               (f)               276,701                  -           1991            12/91         (d)
           327,322               (f)               327,322                  -           1992            02/92         (d)
           348,646               (f)               348,646                  -           1991            04/92         (d)
           202,393               (f)               202,393                  -           1991            04/92         (d)
 

           157,401               (f)               157,401                  -           1977            03/92         (d)
           222,778               (f)               222,778                  -           1975            03/92         (d)


           336,872               (f)               336,872                  -           1991            11/91         (d)
           487,752            567,923            1,055,675              40,138          1992           01/92            (h)
           507,648               (f)               507,648                   -          1987            02/92         (d)
</TABLE>

                                       F-2

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

       SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

                                December 31, 1997

<TABLE>
<CAPTION>

                                                                                                 Costs Capitalized
                                                                                                     Subsequent
                                                               Initial Cost                        To Acquisition
                                                                          Buildings 
                                          Encum-                              and             Improve-      Carrying
                                         brances           Land           Improvements         ments         Costs
<S> <C>
    Pizza Hut Restaurants:
      Bozeman, Montana                        -              99,879            224,614               -            -
      Sidney, Montana                         -             101,690                 -                -            -
      Livingston, Montana                     -              71,989            161,211               -            -
      Laurel, Montana                         -             109,937            255,060               -            -
      Billings, Montana                       -             123,879            200,328               -            -

    Shoney's Restaurants:
      Greenville, North Carolina              -             323,573            515,134               -            -
      North Richland Hills, Texas             -             513,032                 -           420,219           -
      Pelham, Alabama                         -             410,448                 -           427,317           -
      Fort Myers Beach, Florida               -             360,482                 -                -            -
                                                        -----------         ----------       ----------     -------

                                                        $ 9,947,295         $2,956,268       $3,919,583     $     -
                                                        ===========         ==========       ==========     =======

Properties of Joint Venture in
  Which the Partnership has a
  50% Interest and has Invested
  in Under Operating Leases:

    Burger King Restaurants:
      Greensboro, North Carolina              -         $   338,800         $  650,109       $       -      $     -
      Metairie, Louisiana                     -             429,883            342,455               -            -
      Lafayette, Louisiana                    -             350,932            773,129               -            -
      Nashua, New Hampshire                   -             514,815            838,536               -            -
      Pontiac, Illinois                       -             203,095            719,226               -            -
      Dover, New Hampshire                    -             406,259            998,023               -            -
                                                        -----------         ----------       ----------     -------

                                                        $ 2,243,784         $4,321,478       $       -      $     -
                                                        ===========         ==========       ==========     =======

Property of Joint Venture in
  Which the Partnership has a
  10.51% Interest and has Invested
  in Under Operating Lease:

    Burger King Restaurant:
      Ashland, New Hampshire                  -         $   293,478         $  997,104       $       -      $     -
                                                        ===========         ==========       ==========     =======

Property in Which the Partnership
  has a 13.37%  Interest as Tenants-
  in-Common and has Invested in Under
  Operating Lease:

    Golden Corral Family
      Steakhouse Restaurant:
        Clinton, North Carolina               -         $   138,382         $  676,588       $       -      $     -
                                                        ===========         ==========       ==========     =======
</TABLE>




<PAGE>








<TABLE>
<CAPTION>


                                                                                                                         Life
                                                                                                                       on Which
                      Gross Amount at Which Carried                                                                  Depreciation
                        at Close of Period (c)                                                                       in Latest 
                            Buildings                                                  Date                             Income
                               and                                Accumulated         of Con-          Date          Statement is
           Land            Improvements           Total           Depreciation       struction       Acquired          Computed
        ----------         ------------        -----------        ------------       ---------       --------        ----------

<S> <C>
            99,879              224,614            324,493              42,769          1976           03/91            (b)
           101,690                (f)              101,690                  -           1985           03/91            (d)
            71,989              161,211            233,200              30,696          1979           03/91            (b)
           109,937              255,060            364,997              48,566          1985           03/91            (b)
           123,879              200,328            324,207              38,146          1970           03/91            (b)


           323,573              515,134            838,707             105,708          1987           11/91            (b)
           513,032              420,219            933,251              81,089          1992           12/91            (b)
           410,448              427,317            837,765              85,424          1992           01/92            (b)
           360,482                (f)              360,482                  -           1991           09/95         (d)
        ----------           ----------        -----------          ----------

        $9,947,295           $6,875,851        $16,823,146          $1,113,247
        ==========           ==========        ===========          ==========







        $  338,800           $  650,109        $   988,909            $124,797          1990           03/92            (b)
           429,883              342,455            772,338              65,739          1990           03/92            (b)
           350,932              773,129          1,124,061             148,412          1989           03/92            (b)
           514,815              838,536          1,353,351             160,968          1987           03/92            (b)
           203,095              719,226            922,321             138,065          1988           03/92            (b)
           406,259              998,023          1,404,282             191,583          1987           03/92            (b)
        ----------           ----------        -----------          ----------

        $2,243,784           $4,321,478        $ 6,565,262          $  829,564
        ==========           ==========        ===========          ==========







        $  293,478           $  997,104        $ 1,290,582            $174,472          1987           10/92            (b)
        ==========           ==========        ===========            ========








        $  138,382           $  676,588        $   814,970            $ 43,721          1996           01/96            (b)
        ==========           ==========        ===========            ========



</TABLE>




                                       F-3

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

       SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

                                December 31, 1997

<TABLE>
<CAPTION>

                                                                                                  Costs Capitalized
                                                                                                      Subsequent
                                                                           Initial Cost             To Acquisition
                                                                             Buildings
                                           Encum-                              and             Improve-      Carrying
                                          brances           Land           Improvements         ments         Costs
<S> <C>
Property in Which the Partnershi
  has a 6.69% Interest as Tenants-
  in-Common and has Invested in
  Under Operating Lease:

    Chevy's Fresh Mex:
      Miami, Florida                           -         $   976,357        $   974,016       $       -      $     -
                                                         ===========        ===========       ==========     =======
</TABLE>


<PAGE>






<TABLE>
<CAPTION>




                                                                                                                         Life
                                                                                                                       on Which
                     Gross Amount at Which Carried                                                                  Depreciation
                         at Close of Period (c)                                                                       in Latest
                             Buildings                                                  Date                           Income
                               and                                Accumulated         of Con-          Date          Statement is
           Land            Improvements           Total           Depreciation       struction       Acquired          Computed
        ----------         ------------        -----------        ------------       ---------       --------        ----------

<S> <C>





        $  976,357           $  974,016        $ 1,950,373            $     89            1995          12/97             (b)
        ==========           ==========        ===========            ========

</TABLE>


                                       F-4

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

       SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

                                December 31, 1997

<TABLE>
<CAPTION>


                                                                                                                  Costs Capitalized
                                                                                                                     Subsequent
                                                                               Initial Cost                        To Acquisition
                                                                                           Buildings
                                                          Encum-                              and             Improve-      Carrying
                                                         brances           Land           Improvements         ments         Costs
<S> <C>
Properties the Partnership
  has Invested in Under
  Direct Financing Leases:

    Burger King Restaurants:
      Hendersonville, North Carolina                          -         $        -         $   631,129       $       -      $     -
      Ashland, Ohio                                           -             190,695            724,348               -            -
      Irondequoit, New York                                   -                  -             612,810            1,123           -
      Allegan, Michigan                                       -              91,238                 -           418,782           -

    Denny's Restaurants:
      Detroit, Michigan                                       -                  -             752,829               -            -
      Spartanburg, South Carolina                             -                  -             529,410               -            -

    Hardee's Restaurants:
      Pace, Florida                                           -                  -             467,272               -            -
      Jacksonville, Florida                                   -                  -             405,985               -            -
      Hohenwald, Tennessee                                    -              49,201            376,415               -            -
      Ravenna, Ohio                                           -             114,244            496,032               -            -
      New Bethlehem, Pennsylvania                             -             135,929            452,507               -            -
      Morristown, Tennessee                                   -             131,289            456,925               -            -
      Centerville, Tennessee                                  -                  -             348,032               -            -

    Jack in the Box Restaurants:
      Desloge, Missouri                                       -                  -             630,981               -            -
      Sacramento, California                                  -                  -             577,009               -            -
      San Antonio, Texas                                      -                  -                  -           206,031           -
      Nampa, Idaho                                            -             151,574            584,533               -            -
      Missouri City, Texas                                    -                  -             619,686               -            -
      Pasadena, Texas                                         -                  -             575,429               -            -

    Long John Silver's Restaurants:
      Alamogordo, New Mexico                                  -                  -             275,270           20,204           -
      Las Cruces, New Mexico                                  -                  -             318,378           57,828           -

    Perkins Restaurants:
      Lancaster, New York                                     -                  -             865,814               -            -
      Amherst, New York                                       -                  -             727,806               -            -

    Pizza Hut Restaurants:
      Glasgow, Montana                                        -              57,482            266,726               -            -
      Sidney, Montana                                         -                  -             291,238               -            -

    Shoney's Restaurant:
      Fort Myers Beach, Florida                               -                  -             567,640               -            -
                                                                        -----------        -----------       ----------     -------

                                                                        $   921,652        $12,554,204       $  703,968     $     -
                                                                        ===========        ===========       ==========     =======
</TABLE>


<PAGE>









<TABLE>
<CAPTION>


                                                                                                                         Life
                                                                                                                       on Which
                                        Gross Amount at Which Carried                                                Depreciation
                                                at Close of Period (c)                                                in Latest
                            Buildings                                                  Date                             Income
                               and                                Accumulated         of Con-          Date          Statement is
           Land            Improvements           Total           Depreciation       struction       Acquired          Computed
        ----------         ------------        -----------        ------------       ---------       --------        ----------

<S> <C>




             -                  (f)                (f)               -               1986            11/91         (d)
            (f)                 (f)                (f)               -               1988            11/91         (e)
             -                  (f)                (f)               -               1986            11/91         (d)
            (f)                 (f)                (f)               -               1992            04/92         (e)


             -                  (f)                (f)               -               1992            02/92         (d)
             -                  (f)                (f)               -               1992            03/92         (d)


             -                  (f)                (f)               -               1992            01/92         (d)
             -                  (f)                (f)               -               1990            02/92         (d)
            (f)                 (f)                (f)               -               1991            02/92         (e)
            (f)                 (f)                (f)               -               1991            04/92         (e)
            (f)                 (f)                (f)               -               1991            04/92         (e)
            (f)                 (f)                (f)               -               1991            04/92         (e)
             -                  (f)                (f)               -               1991            02/92         (d)


             -                  (f)                (f)               -               1991            12/91         (d)
             -                  (f)                (f)               -               1991            12/91         (d)
             -                  (f)                (f)               -               1992            12/91         (d)
            (f)                 (f)                (f)               -               1991            12/92         (e)
             -                  (f)                (f)               -               1991            04/92         (d)
             -                  (f)                (f)               -               1991            04/92         (d)


             -                  (f)                 (f)               -               1977            03/92         (d)
             -                  (f)                 (f)               -               1975            03/92         (d)


             -                  (f)                 (f)               -               1991            11/91         (d)
             -                  (f)                 (f)               -               1987            02/92         (d)


            (f)                 (f)                 (f)               -               1985            03/91         (e)
             -                  (f)                 (f)               -               1985            03/91         (d)


             -                  (f)                  (f)               -               1991            09/95         (d)
</TABLE>

                                       F-5

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

       SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

                                December 31, 1997


<TABLE>
<CAPTION>

                                                                                                                  Costs Capitalized
                                                                                                                      Subsequent
                                                                                 Initial Cost                       To Acquisition
                                                                                            Buildings
                                                          Encum-                              and             Improve-      Carrying
                                                         brances           Land           Improvements         ments         Costs
<S> <C>
Property of Joint Venture in
  Which the Partnership has a
  41% Interest and has Invested
  in Under Direct Financing Lease:

    Hardee's Restaurant:
      Williston, Florida                                      -         $   150,143         $       -        $  499,071     $     -
                                                                        ===========         ==========       ==========     =======

</TABLE>



<PAGE>









<TABLE>
<CAPTION>


                                                                                                                         Life
                                                                                                                       on Which
                                        Gross Amount at Which Carried                                                Depreciation
                                                 at Close of Period (c)                                               in Latest
                            Buildings                                                  Date                             Income
                               and                                Accumulated         of Con-          Date          Statement is
          Land             Improvements           Total           Depreciation       struction       Acquired          Computed
       -----------         ------------        -----------        ------------       ---------       --------        ----------

<S> <C>





                (f)                    (f)                (f)               -               1993            12/92         (e)




</TABLE>





                                       F-6

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

        NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

                                December 31, 1997



(a)      Transactions in real estate and accumulated  depreciation  during 1996,
         1995 and 1994, are summarized as follows:
<TABLE>
<CAPTION>

                                                                              Accumulated
                                                               Cost           Depreciation
<S> <C>
                    Properties the Partnership
                      has Invested in Under
                      Operating Leases:

                        Balance, December 31, 1994          $16,249,224        $  556,873
                        Acquisitions                            360,482                -
                        Dispositions                         (1,054,458)          (64,287)
                        Depreciation expense                         -            199,696
                                                            -----------        ----------

                        Balance, December 31, 1995           15,555,248           692,282
                        Reclassified to operating
                          lease                                 567,923                -
                        Depreciation expense                         -            206,497
                                                            -----------        ----------

                        Balance, December 31, 1996           16,123,171           898,779
                        Acquisitions                          1,277,307                -
                        Dispositions                           (577,332)               -
                        Depreciation Expense                         -            214,468
                                                            -----------        ----------

                        Balance, December 31, 1997          $16,823,146        $1,113,247
                                                            ===========        ==========

                      Properties of Joint Venture in
                        Which the  Partnership  has a
                        50% Interest and has Invested
                        in Under Operating Leases:

                        Balance, December 31, 1994          $ 6,565,262          $397,417
                        Depreciation expense                         -            144,050
                                                            -----------          --------

                        Balance, December 31, 1995            6,565,262           541,467
                        Depreciation expense                         -            144,050
                                                            -----------          --------

                        Balance, December 31, 1996            6,565,262           685,517
                        Depreciation expense                         -            144,047
                                                            -----------          --------

                        Balance, December 31, 1997          $ 6,565,262          $829,564
                                                            ===========          ========
</TABLE>

                                       F-7

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 1997

<TABLE>
<CAPTION>

                                                                                 Accumulated
                                                                  Cost           Depreciation
<S> <C>
                    Property of Joint  Venture
                     in Which the Partnership has a
                      10.51% Interest and has
                      Invested in Under Operating Lease:

                        Balance, December 31, 1994            $ 1,290,582         $ 74,851
                        Depreciation expense                           -            33,237
                                                              -----------         --------

                        Balance, December 31, 1995              1,290,582          108,088
                        Depreciation expense                           -            33,237
                                                              -----------         --------

                        Balance, December 31, 1996              1,290,582          141,325
                        Depreciation expense                           -            33,147
                                                              -----------         --------

                        Balance, December 31, 1997            $ 1,290,582         $174,472
                                                              ===========         ========


                    Property in Which the Partnership
                      has a 13.37% Interest as Tenants-
                      in-Common and has Invested in
                      Under an Operating Lease:

                        Balance, December 31, 1995            $        -          $     -
                        Acquisition                               814,970               -
                        Depreciation expense                           -            21,168
                                                              -----------         --------

                        Balance, December 31, 1996                814,970           21,168
                        Depreciation expense                           -            22,553
                                                              -----------         --------

                        Balance, December 31, 1997            $   814,970         $ 43,721
                                                              ===========         ========


                    Property in Which the Partnership
                      has a 6.69% Interest as Tenants-
                      in-Common and has Invested in
                      Under an Operating Lease:

                        Balance, December 31, 1996            $        -          $     -
                        Acquisitions                            1,950,373               -
                        Depreciation expense                           -                89
                                                              -----------         --------

                        Balance, December 31, 1997            $ 1,950,373         $     89
                                                              ===========         ========
</TABLE>


(b)        Depreciation expense is computed for buildings and improvements based
           upon estimated lives of 30 years.

(c)        As of December 31, 1997, the aggregate  cost of the Properties  owned
           by the  Partnership  and  its  consolidated  joint  venture,  and the
           unconsolidated  joint  ventures  for federal  income tax purposes was
           $30,453,448  and  $9,254,434,  respectively.  All of the  leases  are
           treated as operating leases for federal income tax purposes.

                                       F-8

<PAGE>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 1997



(d)        For financial reporting  purposes,  the portion of the lease relating
           to the building has been recorded as a direct  financing  lease.  The
           cost of the building has been  included in net  investment  in direct
           financing leases; therefore, depreciation is not applicable.

(e)        For financial reporting purposes, the lease for the land and building
           has been recorded as a direct  financing  lease. The cost of the land
           and building has been included in net investment in direct  financing
           leases; therefore, depreciation is not applicable.

(f)        For financial  reporting  purposes,  certain  components of the lease
           relating  to  land  and  building  have  been  recorded  as a  direct
           financing lease.  Accordingly,  costs relating to these components of
           this lease are not shown.

(g)        Effective  January 1, 1994,  the lease for this Property was amended,
           resulting  in the  reclassification  of the  building  portion of the
           lease to an  operating  lease.  The building was recorded at net book
           value as of January  1,  1994,  and  depreciated  over its  remaining
           estimated life of approximately 28 years.

(h)        Effective  March 1, 1996,  the lease for this  Property  was amended,
           resulting  in the  reclassification  of the  building  portion of the
           lease to an  operating  lease.  The building was recorded at net book
           value  as of March  1,  1996,  and  depreciated  over  its  remaining
           estimated life of approximately 26 years.

                                       F-9

<PAGE>



                                    EXHIBITS


<PAGE>


                                  EXHIBIT INDEX


Exhibit Number                                                           Page

      3.1         Affidavit and Certificate of Limited Partnership of CNL Income
                  Fund  X,  Ltd.   (Included  as  Exhibit  3.2  to  Registration
                  Statement No. 33-35049 on Form S-11 and incorporated herein by
                  reference.)

      4.1         Affidavit and Certificate of Limited Partnership of CNL Income
                  Fund  X,  Ltd.   (Included  as  Exhibit  3.2  to  Registration
                  Statement No. 33-35049 on Form S-11 and incorporated herein by
                  reference.)

      4.2         Amended and Restated  Agreement of Limited  Partnership of CNL
                  Income Fund X, Ltd. (Included as Exhibit 3.3 to Post-Effective
                  Amendment No. 4 to Registration Statement No. 33-35049 on Form
                  S-11 and incorporated herein by reference.)

     10.1         Management Agreement between CNL Income Fund X, Ltd. and CNL
                  Investment Company (Filed herewith.)

     10.2         Assignment of Management Agreement from CNL Investment Company
                  to CNL Income Fund Advisors, Inc. (Included as Exhibit 10.2 to
                  Form 10-K filed with the Securities and Exchange Commission on
                  March 30, 1995, and incorporated herein by reference.)

     10.3         Assignment  of  Management  Agreement  from  CNL  Income  Fund
                  Advisors, Inc. to CNL Fund Advisors, Inc. (Included as Exhibit
                  10.3 to Form  10-K  filed  with the  Securities  and  Exchange
                  Commission  on April  1,  1996,  and  incorporated  herein  by
                  reference)

     27           Financial Data Schedule (Filed herewith.)

                                        i