<PAGE>

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

(Mark One)

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

                  For the quarterly period ended June 30, 2000

                                       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 0-22300

                        PW PREFERRED YIELD FUND II, L.P.
             (Exact name of registrant as specified in its charter)

          DELAWARE                                     84-1180783
   (State of organization)                            (IRS Employer
                                                     Identification No.)

       88 BROAD STREET
     BOSTON, MASSACHUSETTS                                 02110
     (Address of principal                               (Zip Code)
       executive offices)

        Registrant's telephone number, including area code (617)854-5800

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


<PAGE>


                               PW PREFERRED YIELD
                                  FUND II, L.P.
                      QUARTERLY REPORT ON FORM 10-Q FOR THE
                           QUARTER ENDED JUNE 30, 2000

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                      Page
                                                                                                                      ----
<S>              <C>                                                                                                  <C>
PART I.           FINANCIAL INFORMATION

                  Item 1.           Financial Statements

                                    Balance Sheets - June 30, 2000 and December 31,
                                    1999 (unaudited)                                                                     3

                                    Statements of Income for the three months ended
                                    June 30, 2000 and 1999 (unaudited)                                                   4

                                    Statements of Income for the six months ended
                                    June 30, 2000 and 1999 (unaudited)                                                   5

                                    Statements of Partners' Equity for the six
                                    months ended June 30, 2000 and 1999 (unaudited)                                      6

                                    Statements of Cash Flows for the six months
                                    ended June 30, 2000 and 1999 (unaudited)                                             7

                                    Notes to Financial Statements (unaudited)                                          8-9

                  Item 2.           Management's Discussion and Analysis of Financial
                                    Condition and Results of Operations                                              10-12

PART II.          OTHER INFORMATION

                  Item 1.           Legal Proceedings                                                                   13

                  Item 5.           Other Information                                                                   13

                  Item 6.           Exhibits and Reports on Form 8-K                                                    13

                                    Signatures                                                                          14

</TABLE>


                                       2
<PAGE>


PART I. FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

                        PW PREFERRED YIELD FUND II, L.P.

                                 BALANCE SHEETS
                       JUNE 30, 2000 AND DECEMBER 31, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                             JUNE 30,           DECEMBER 31,
                                                                                              2000                 1999
                                                                                       ----------------         ----------
<S>                                                                                   <C>                   <C>
                                     ASSETS

Cash and cash equivalents                                                              $      1,717,263     $     1,926,081
Rents and other receivables, net of allowance for doubtful
   accounts of $33,000 and $47,000 at June 30, 2000
   and December 31, 1999, respectively                                                          419,129             503,000
Equipment at cost, net of accumulated depreciation of
   $12,927,070 and $12,736,703 at June 30, 2000 and
   December 31, 1999, respectively                                                            9,050,048           9,806,215
                                                                                       ----------------     ---------------

              Total Assets                                                             $     11,186,440     $    12,235,296
                                                                                       ================     ===============

                        LIABILITIES AND PARTNERS' EQUITY

LIABILITIES:
   Accounts payable and accrued liabilities                                            $         60,500     $        54,100
   Payable to affiliates                                                                         98,193             103,043
   Deferred rental income                                                                       112,778              89,162
   Distributions payable to partners                                                            318,785             318,785
                                                                                       ----------------     ---------------

      Total Liabilities                                                                         590,256             565,090
                                                                                       ----------------     ---------------

PARTNERS' EQUITY:
   General Partners                                                                             514,436             568,137
   Limited Partners:
     Class A (54,027 Units outstanding)                                                       8,820,774           9,713,555
     Class B                                                                                  1,260,974           1,388,514
                                                                                       ----------------     ---------------

       Total Partners' Equity                                                                10,596,184          11,670,206
                                                                                       ----------------     ---------------

              Total Liabilities and Partners' Equity                                   $     11,186,440     $    12,235,296
                                                                                       ================     ===============

</TABLE>

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


                                       3
<PAGE>


                        PW PREFERRED YIELD FUND II, L.P.

                              STATEMENTS OF INCOME
                FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                            2000                    1999
                                                                                     -----------------          -----------
<S>                                                                                  <C>                   <C>
REVENUE:
    Lease revenue                                                                    $       1,037,157      $       1,221,249
    Gain (loss) on sale of equipment                                                             6,427               (315,193)
    Interest income                                                                             24,041                 39,713
                                                                                     -----------------      -----------------

         Total Revenue                                                                       1,067,625                945,769
                                                                                     -----------------      -----------------
EXPENSES:
    Depreciation                                                                               635,900                730,585
    Management fees (Note 2)                                                                    42,364                 51,302
    General and administrative                                                                  27,180                 21,527
                                                                                     -----------------      -----------------

         Total Expenses                                                                        705,444                803,414
                                                                                     -----------------      -----------------
NET INCOME                                                                           $         362,181      $         142,355
                                                                                     =================      =================

NET INCOME ALLOCATED:
   To the General Partners                                                           $          18,109      $          7,117
   To the Class A Limited Partners                                                             322,054               139,324
   To the Class B Limited Partner                                                               22,018                (4,086)
                                                                                     -----------------      ----------------

                                                                                     $         362,181      $        142,355
                                                                                     =================      ================

NET INCOME PER WEIGHTED AVERAGE
   NUMBER OF UNITS OF CLASS A LIMITED
   PARTNER INTEREST OUTSTANDING                                                      $            5.96      $           2.58
                                                                                     =================      ================

WEIGHTED AVERAGE NUMBER OF
   UNITS OF CLASS A LIMITED PARTNER
   INTEREST OUTSTANDING                                                                         54,027                54,027
                                                                                     =================      ================

</TABLE>

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


                                       4
<PAGE>


                        PW PREFERRED YIELD FUND II, L.P.

                              STATEMENTS OF INCOME
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                            2000                   1999
                                                                                     -----------------          -----------
<S>                                                                                  <C>                    <C>
REVENUE:

    Lease revenue                                                                    $       2,102,862      $       2,465,386
    Gain (loss) on sale of equipment                                                            30,000               (275,473)
    Interest income                                                                             38,249                 76,291
                                                                                     -----------------      -----------------

         Total Revenue                                                                       2,171,111              2,266,204
                                                                                     -----------------      -----------------

EXPENSES:

    Depreciation                                                                             1,350,550              1,594,261
    Management fees (Note 2)                                                                    86,232                103,673
    General and administrative                                                                  71,498                 49,212
                                                                                     -----------------      -----------------

         Total Expenses                                                                      1,508,280              1,747,146
                                                                                     -----------------      -----------------

NET INCOME                                                                           $         662,831      $         519,058
                                                                                     =================      =================

NET INCOME ALLOCATED:
   To the General Partners                                                           $          33,142      $          25,953
   To the Class A Limited Partners                                                             592,961                473,450
   To the Class B Limited Partner                                                               36,728                 19,655
                                                                                     -----------------      -----------------

                                                                                     $         662,831      $         519,058
                                                                                     =================      =================

NET INCOME PER WEIGHTED AVERAGE
   NUMBER OF UNITS OF CLASS A LIMITED
   PARTNER INTEREST OUTSTANDING                                                      $           10.98      $            8.76
                                                                                     =================      =================

WEIGHTED AVERAGE NUMBER OF
   UNITS OF CLASS A LIMITED PARTNER
   INTEREST OUTSTANDING                                                                         54,027                 54,027
                                                                                     =================      =================

</TABLE>

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


                                       5
<PAGE>


                        PW PREFERRED YIELD FUND II, L.P.

                         STATEMENTS OF PARTNERS' EQUITY
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                      CLASS A               CLASS B
                                                 GENERAL              LIMITED               LIMITED
                                                PARTNERS             PARTNERS               PARTNER                TOTAL
                                                --------             --------               -------                -----
<S>                                        <C>                  <C>                   <C>                  <C>
Balance, January 1, 2000                    $        568,137     $      9,713,555      $      1,388,514     $     11,670,206
Net income                                            33,142              592,961                36,728              662,831
Distributions declared to partners                   (86,843)          (1,485,742)             (164,268)          (1,736,853)
                                            ----------------     ----------------      ----------------     ----------------

Balance, June 30, 2000                      $        514,436     $      8,820,774      $      1,260,974     $     10,596,184
                                            ================     ================      ================     ================

Balance, January 1, 1999                    $        661,502     $     11,265,748      $      1,610,256     $     13,537,506
Net income                                            25,953              473,450                19,655              519,058
Distributions declared to partners                   (86,843)          (1,485,742)             (164,268)          (1,736,853)
                                            ----------------     ----------------      ----------------     ----------------

Balance, June 30, 1999                      $        600,612     $     10,253,456      $      1,465,643     $     12,319,711
                                            ================     ================      ================     ================

</TABLE>

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


                                       6
<PAGE>


                        PW PREFERRED YIELD FUND II, L.P.

                            STATEMENTS OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                                  2000              1999
                                                                                            ----------------    -----------
<S>                                                                                    <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net income                                                                         $        662,831    $        519,058
     Adjustments to reconcile net income to net cash
       from operating activities:
         Depreciation                                                                          1,350,550           1,594,261
         (Gain) loss on sale of equipment                                                        (30,000)            275,473
     Change in assets and liabilities:
         Rents and other receivables                                                              97,871             181,145
         Allowance for doubtful accounts                                                         (14,000)                 --
         Accounts payable and accrued liabilities                                                  6,400              (5,000)
         Payable to affiliates                                                                    (4,850)              2,828
         Deferred rental income                                                                   23,616              49,037
                                                                                        ----------------    ----------------

             Net cash from operating activities                                                2,092,418           2,616,802
                                                                                        ----------------    ----------------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchase of equipment                                                                        (697,611)         (1,908,215)
   Proceeds from equipment sales                                                                 133,228             501,948
                                                                                        ----------------    ----------------

            Net cash used in investing activities                                               (564,383)         (1,406,267)
                                                                                        ----------------    ----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Distributions paid to partners                                                             (1,736,853)         (1,737,393)
                                                                                        ----------------    ----------------

            Net cash used in financing activities                                             (1,736,853)         (1,737,393)
                                                                                        ----------------    ----------------

NET DECREASE IN CASH AND CASH EQUIVALENTS                                                       (208,818)           (526,858)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                               1,926,081           3,629,653
                                                                                        ----------------    ----------------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                              $      1,717,263    $      3,102,795
                                                                                        ================    ================

</TABLE>

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


                                       7
<PAGE>


                        PW PREFERRED YIELD FUND II, L.P.

                          NOTES TO FINANCIAL STATEMENTS

                                  JUNE 30, 2000
                                   (UNAUDITED)

1.       GENERAL

         The financial statements presented herein are prepared in conformity
with generally accepted accounting principles and the instructions for preparing
Form 10-Q under Rule 10-01 of Regulation S-X of the Securities and Exchange
Commission and are unaudited. As such, these financial statements do not include
all information and footnote disclosures required under generally accepted
accounting principles for complete financial statements and, accordingly, the
accompanying financial statements should be read in conjunction with the
footnotes presented in the 1999 Annual Report. Except as disclosed herein, there
has been no material change to the information presented in the footnotes to the
1999 Annual Report.

         In the opinion of management, all adjustments (consisting of normal and
recurring adjustments) considered necessary to present fairly the financial
position at June 30, 2000 and December 31, 1999 and results of operations for
the three and six month periods ended June 30, 2000 and 1999 have been made and
are reflected.

2.       TRANSACTIONS WITH AFFILIATES

                        ACQUISITION AND OPERATING STAGES

         ACQUISITION OF EQUIPMENT Pursuant to its investment objectives, the
Partnership has acquired, on an all-cash basis, certain leased equipment from
Equis Financial Group L.P. ("EFG") (formerly American Finance Group or AFG), an
affiliate of the Managing General Partner.

         The purchase price of the equipment acquired from EFG is equal to the
lesser of the adjusted cost of the equipment or the appraised value of the
equipment at the time of its acquisition by the Partnership ("EFG carrying
value"). The adjusted cost of the equipment is equal to the price paid by EFG,
plus the cost of an appraisal, EFG's cost of interim financing for the equipment
and any taxes paid by EFG, less certain interim rentals received by EFG with
respect to the equipment.

         ACQUISITION FEE The Managing General Partner, or its affiliates,
receives or is entitled to receive a fee equal to (i) 2.25% of the purchase
price of equipment purchased with net offering proceeds from the sale of Units,
and (ii) 3% of the purchase price of equipment purchased with reinvested
Partnership cash flow as compensation for evaluating, selecting, negotiating and
consummating the acquisition of the equipment. Acquisition fees of $15,890 and
$20,319 were earned by the Managing General Partner during the quarter and six
months ended June 30, 2000.


                                       8
<PAGE>


                        PW PREFERRED YIELD FUND II, L.P.

                          NOTES TO FINANCIAL STATEMENTS
                                   (CONTINUED)

         MANAGEMENT FEES The General Partners are entitled to receive a monthly
fee in an amount equal to 2% of gross rentals for Full Payout Leases, as defined
in the Partnership Agreement and 5% of gross rentals for other leases (payable
66.67% to the Managing General Partner and 33.33% to the Administrative General
Partner) as compensation for services rendered in connection with the management
of the equipment. Management fees of $42,364 and $86,232 were earned by the
General Partners during the quarter and six months ended June 30, 2000.
Effective July 1, 1998, the Managing General Partner agreed to perform certain
administrative functions on behalf of the Partnership that previously had been
performed by the Administrative General Partner. For these services, the
Administrative General Partner pays the Managing General Partner an amount
equivalent to the fees otherwise due the Administrative General Partner.

         DISPOSITION FEES The General Partners, or their affiliates, were
entitled to receive a subordinated disposition fee in an amount equal to the
lesser of (i) 50% of the fee that would be charged by an unaffiliated party, or
(ii) 3% of the gross contract price relating to each sale of equipment (payable
50% to the Managing General Partner or its affiliates and 50% to the
Administrative General Partner) as compensation for negotiating and consummating
sales of equipment. During the fourth quarter of 1998, the Partnership reversed
previously accrued subordinated disposition fees because the General Partners
concluded that it was no longer probable that these subordinated disposition
fees would be paid. The Partnership has not accrued for subordinated disposition
fees during 1999 or 2000.


                                       9
<PAGE>


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

         The following discussion should be read in conjunction with the
Consolidated Financial Statements of the Partnership and the Notes thereto. This
report contains, in addition to historical information, forward-looking
statements that include risks and other uncertainties. The Partnership's actual
results may differ materially from those anticipated in these forward-looking
statements. Factors that might cause such a difference include those discussed
below, as well as general economic and business conditions, competition and
other factors discussed elsewhere in this report. The Partnership undertakes no
obligation to release publicly any revisions to these forward-looking statements
to reflect events or circumstances after the date hereof or to reflect the
occurrence of anticipated or unanticipated events.

LIQUIDITY AND CAPITAL RESOURCES

         The Partnership commenced its equipment reinvestment phase during 1993
by investing excess cash flows available after the payment of the distributions
to the partners in additional equipment. As of June 30, 2000, equipment
purchased pursuant to the reinvestment program, including acquisition fees and
expenses, totaled $27,713,952. Additional equipment will be purchased pursuant
to the reinvestment program which will end on September 30, 2000.

         The Partnership invests working capital and cash flow from operations
prior to its distribution to the partners or its reinvestment in additional
equipment in short-term highly liquid investments. These investments are
primarily short-term commercial paper issued by large domestic corporations. At
June 30, 2000, the Partnership had approximately $1.5 million invested in
commercial paper and a fund that invests in similar instruments.

         Cash and cash equivalents decreased $208,818 from $1,926,081 at
December 31, 1999 to $1,717,263 at June 30, 2000. This decrease primarily
represents the amount by which cash used to pay distributions to partners and
cash used to purchase equipment exceeded cash generated by operating activities
and equipment sales.

         During the six months ended June 30, 2000, the Partnership declared
distributions of cash flow received from operations in the amount of $1,736,853.
All distributions to the Class A Limited Partners represented an annualized
distribution rate of 11% of their contributed capital and all distributions to
the Class B Limited Partner represented an annualized distribution rate of 10%
of its contributed capital.

         Distributions may be characterized for tax, accounting and economic
purposes as a return of capital, a return on capital or both. The portion of
each cash distribution by a partnership, which exceeds its net income for the
fiscal period, may be deemed a return of capital. Based upon the amount of net
income reported by the Partnership for accounting purposes, approximately 60% of
the 11% cash distributions to the Class A Limited Partners for the six months
ended June 30, 2000 constituted a return of capital. Additionally, since
inception, approximately 70% of the Class A Limited Partner's 11% cash
distributions constituted a return of capital. However, the total actual return
on capital over a leasing partnership's life can only be determined at the
termination of the Partnership after all residual cash flows (which include
proceeds from the re-leasing and sale of equipment after initial lease terms
expire) have been realized.


                                       10
<PAGE>


RESULTS OF OPERATIONS

         For the three and six months ended June 30, 2000, the Partnership
recognized lease revenue of $1,037,157 and $2,102,862, respectively, compared to
$1,221,249 and $2,465,386 for the same periods in 1999. The overall decrease in
lease revenue from 1999 to 2000 was expected and resulted principally from
primary lease term expirations and the sale of equipment. The Partnership also
earns interest income from temporary investments of rental receipts and
equipment sales proceeds in short-term instruments.

         During the three months ended June 30, 2000, the Partnership sold
equipment having a net book value of $88,671 to existing lessees and third
parties. These sales resulted in a net gain, for financial statement purposes,
of $6,427 compared to a net loss in 1999 of $315,193 on equipment having a net
book value of $544,505.

         During the six months ended June 30, 2000, the Partnership sold
equipment having a net book value of $103,228 to existing lessees and third
parties. These sales resulted in a net gain, for financial statement purposes,
of $30,000 compared to a net loss in 1999 of $275,473 on equipment having a net
book value of $777,421.

         It cannot be determined whether future sales of equipment will result
in a net gain or a net loss to the Partnership, as such transactions will be
dependent upon the condition and type of equipment being sold and its
marketability at the time of sale. In addition, the amount of gain or loss
reported for financial statement purposes is partly a function of the amount of
accumulated depreciation associated with the equipment being sold.

         The ultimate realization of residual value for any type of equipment is
dependent upon many factors, including EFG's ability to sell and re-lease
equipment. Changing market conditions, industry trends, technological advances,
and many other events can converge to enhance or detract from asset values at
any given time. EFG attempts to monitor these changes in order to identify
opportunities which may be advantageous to the Partnership and which will
maximize total cash returns for each asset.

         The total economic value realized upon final disposition of each asset
is comprised of all primary lease term revenues generated from that asset,
together with its residual value. The latter consists of cash proceeds realized
upon the asset's sale in addition to all other cash receipts obtained from
renting the asset on a re-lease, renewal or month-to-month basis. The
Partnership classifies such residual rental payments as lease revenue.
Consequently, the amount of gain or loss reported in the financial statements is
not necessarily indicative of the total residual value the Partnership achieved
from leasing the equipment.

         Depreciation expense for the three and six months ended June 30, 2000
was $635,900 and $1,350,550, respectively, compared to $730,585 and $1,594,261,
for the same periods in 1999. For financial reporting purposes, to the extent
that an asset is held on primary lease term, the Partnership depreciates the
difference between (i) the cost of the asset and (ii) the estimated residual
value of the asset on a straight-line basis over such term. For purposes of this
policy, estimated residual values represent estimates of equipment values at the
date of primary lease expiration. To the extent that an


                                       11
<PAGE>


asset is held beyond its primary lease term, the Partnership continues to
depreciate the remaining net book value of the asset on a straight-line basis
over the asset's remaining economic life.

         Management fees were approximately 4.1% of lease revenue during both
the three and six months ended June 30, 2000, respectively, compared to 4.2% of
lease revenue during both the three and six months ended June 30, 1999,
respectively. Management fees are based on 5% of gross lease revenue generated
by operating leases and 2% of gross lease revenue generated by full payout
leases.

         The General Partners, or their affiliates, were entitled to receive a
subordinated disposition fee in an amount equal to the lesser of (i) 50% of the
fee that would be charged by an unaffiliated party, or (ii) 3% of the gross
contract price relating to each sale of equipment (payable 50% to the Managing
General Partner or its affiliates and 50% to the Administrative General Partner)
as compensation for negotiating and consummating sales of equipment. During the
fourth quarter of 1998, the Partnership reversed previously accrued subordinated
disposition fees because the General Partners concluded that it was no longer
probable that these subordinated disposition fees would be paid. The Partnership
has not accrued for subordinated disposition fees during 1999 or 2000.

         General and administrative expenses consisted primarily of investor
reporting expenses and transfer agent and audit fees.


                                       12
<PAGE>


                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         None.

ITEM 5.  OTHER INFORMATION

         None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      None.

         (b)      The Partnership did not file any Forms 8-K during the second
                  quarter of the fiscal year ending December 31, 2000.


                                       13
<PAGE>


                                    SIGNATURE

         Pursuant to the requirements 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.

                                       PW Preferred Yield Fund II, L.P.
                                       (Registrant)

                                       By: General Equipment Management II, Inc.
                                           A General Partner


Date: August 14, 2000                  By:  /s/ Carmine Fusco
                                            Carmine Fusco
                                            VICE PRESIDENT, SECRETARY,
                                            TREASURER AND CHIEF FINANCIAL
                                            AND ACCOUNTING OFFICER



                                       14
<PAGE>


                                    SIGNATURE

         Pursuant to the requirements 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.

                                       PW Preferred Yield Fund II, L.P.
                                       (Registrant)

                                       By: General Equipment Management II, Inc.
                                           A General Partner

Date: August 14, 2000                  By:
                                           --------------------------------
                                           Carmine Fusco
                                           VICE PRESIDENT, SECRETARY,
                                           TREASURER AND CHIEF FINANCIAL
                                           AND ACCOUNTING OFFICER



                                       14