<PAGE>
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549
 
                                   FORM 10-Q
 
(Mark One)

[ X X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
        SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended March 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_____________________
                              _____________________

For Quarter Ended March 31, 1997                    Commission File No. 33-42946
 
                             AFG Investment Trust D
             (Exact name of registrant as specified in its charter)

Delaware                                                04-3157232
(State or other jurisdiction of                         (IRS Employer
incorporation or organization)                          Identification No.)

98 North Washington Street, Boston, MA                  02114
(Address of principal executive offices)                (Zip Code)
 
Registrant's telephone number, including area code (617) 854-5800

-------------------------------------------------------------------------------
            (Former name, former address and former fiscal year,
                      if changed since last report.)
 
    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /
 
               APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS
 
    Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court 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 / / No / /

<PAGE>
                             AFG INVESTMENT TRUST D
 
                                   FORM 10-Q
 
                                     INDEX
 
<TABLE>
<CAPTION>
                                                                           PAGE
                                                                           -----
<S>                                                                         <C>                                 <C>

PART I. FINANCIAL INFORMATION:

   Item 1. Financial Statements

      Statement of Financial Position
        at March 31, 1997 and December 31, 1996                                3

      Statement of Operations
        for the three months ended March 31, 1997 and 1996                     4

      Statement of Cash Flows
        for the three months ended March 31, 1997 and 1996                     5

      Notes to the Financial Statements                                      6-9

   Item 2. Management's Discussion and Analysis of Financial
           Condition and Results of Operations                             10-14

PART II. OTHER INFORMATION:

   Items 1--6                                                                 15
</TABLE>

                                       2

<PAGE>

                             AFG INVESTMENT TRUST D
 
                        STATEMENT OF FINANCIAL POSITION
                      March 31, 1997 and December 31, 1996
                                  (Unaudited)
 
<TABLE>
<CAPTION>
                                                                   MARCH 31,    DECEMBER 31,
                                                                     1997           1996
                                                                 -------------  -------------
<S>                                                              <C>            <C>
ASSETS
 
Cash and cash equivalents......................................  $  10,384,291  $   6,640,347
 
Rents receivable...............................................      2,605,296      3,347,306
 
Accounts receivable--affiliate.................................        360,829      3,845,655
 
Equipment at cost, net of accumulated depreciation of
  $32,228,269 and $29,093,445 at March 31, 1997 and December
  31, 1996, respectively.......................................     58,204,176     61,357,491
 
Organization costs, net of accumulated amortization of $3,500
  and $3,250 at March 31, 1997 and December 31, 1996,
  respectively.................................................          1,500          1,750
                                                                 -------------  -------------
 
    Total assets...............................................  $  71,556,092  $  75,192,549
                                                                 -------------  -------------
                                                                 -------------  -------------
 
LIABILITIES AND PARTICIPANTS' CAPITAL
 
Notes payable..................................................  $  29,594,007  $  32,827,977
Accrued interest...............................................        491,729        727,187
Accrued liabilities............................................         18,750         23,250
Accrued liabilities--affiliate.................................        104,916        214,247
Deferred rental income.........................................        371,927        200,836
Cash distributions payable to participants.....................        314,216        314,216
                                                                 -------------  -------------
    Total liabilities..........................................     30,895,545     34,307,713
                                                                 -------------  -------------

Participants' capital (deficit):
  Managing Trustee.............................................        (65,107)       (62,865)
  Special Beneficiary..........................................       (544,388)      (525,884)
  Beneficiary Interests (2,089,030 Interests;
  initial purchase price of $25 each)..........................     41,270,042     41,473,585
                                                                 -------------  -------------

    Total participants' capital................................     40,660,547     40,884,836
                                                                 -------------  -------------

    Total liabilities and participants' capital................  $  71,556,092  $  75,192,549
                                                                 -------------  -------------
                                                                 -------------  -------------
</TABLE>

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

                                       3

<PAGE>
                             AFG INVESTMENT TRUST D
 
                             STATEMENT OF OPERATIONS
                for the three months ended March 31, 1997 and 1996
                                  (Unaudited)
 
<TABLE>
<CAPTION>
                                                                        1997          1996
                                                                    ------------  ------------
<S>                                                                 <C>           <C>
Income:
  Lease revenue...................................................  $  4,759,553  $  5,600,700
 Interest income..................................................       121,151        13,821
  Loss on sale of equipment.......................................        (4,946)      (90,565)
                                                                    ------------   -----------
    Total income..................................................     4,875,758     5,523,956

Expenses:
  Depreciation and amortization...................................     3,142,119     3,541,915
  Interest expense................................................       654,992       892,672
  Equipment management fees--affiliate............................       219,681       246,928
  Operating expenses--affiliate...................................       140,602       163,595
                                                                    ------------   -----------
    Total expenses................................................     4,157,394     4,845,110

Net income........................................................  $    718,364  $    678,846
                                                                    ------------   -----------
                                                                    ------------   -----------

Net income
  per Beneficiary Interest........................................  $       0.31  $       0.29
                                                                    ------------   -----------
                                                                    ------------   -----------

Cash distributions declared
  per Beneficiary Interest........................................  $       0.41  $       0.31
                                                                    ------------   -----------
                                                                    ------------   -----------
</TABLE>
 
                   The accompanying notes are an integral part
                          of these financial statements.

                                       4
<PAGE>
                            AFG INVESTMENT TRUST D
 
                            STATEMENT OF CASH FLOWS
                for the three months ended March 31, 1997 and 1996
                                (Unaudited)
 
<TABLE>
<CAPTION>
                                                                        1997         1996
                                                                    -----------   -----------
<S>                                                                 <C>           <C>
Cash flows from (used in) operating activities:
Net income.......................................................   $   718,364   $   678,846
Adjustments to reconcile net income to
  net cash from operating activities:
    Depreciation and amortization................................     3,142,119     3,541,915
    Loss on sale of equipment....................................         4,946        90,565
Changes in assets and liabilities
  Decrease (increase) in:
    rents receivable.............................................       742,010       397,646
    accounts receivable--affiliate...............................     3,484,826      (652,951)
  Increase (decrease) in:
    accrued interest.............................................      (235,458)      (33,128)
    accrued liabilities..........................................        (4,500)        3,636
    accrued liabilities--affiliate...............................      (109,331)       76,480
    deferred rental income.......................................       171,091      (182,045)
                                                                     ----------    -----------
        Net cash from operating activities.......................     7,914,067     3,920,964
                                                                     ----------    -----------
Cash flows from (used in) investing
  activities:
   Purchase of equipment.........................................            --    (1,239,741)
   Proceeds from equipment sales.................................         6,500       266,945
                                                                     ----------    ----------
         Net cash from (used in) investing activities............         6,500      (972,796)
                                                                     ----------    -----------
Cash flows from (used in) financing activities:
   Proceeds from notes payable...................................            --       997,888
   Principal payments - notes payable............................    (3,233,970)   (3,004,285)
   Distributions paid............................................      (942,653)     (725,117)
                                                                     -----------   -----------

            Net cash used in financing activities................    (4,176,623)   (2,731,514)
                                                                     -----------   -----------
Net increase in cash and cash equivalents........................     3,743,944       216,654

Cash and cash equivalents at beginning of period.................     6,640,347       669,998
                                                                     -----------   -----------

Cash and cash equivalents at end of period.......................  $ 10,384,291    $  886,652
                                                                   ------------    ----------
                                                                   ------------    ----------


Supplemental disclosure of cash flow information:
   Cash paid during the period for interest......................  $    890,450    $  925,800
                                                                   ------------    ----------
                                                                   ------------    ----------
</TABLE>
                    The accompanying notes are an integral part
                           of these financial statements

                                         5


<PAGE>
                                AFG INVESTMENT TRUST D
 
                         NOTES TO THE FINANCIAL STATEMENTS 
                                  MARCH 31, 1997
 
                                    (UNAUDITED)
 
NOTE 1 - BASIS OF PRESENTATION
------------------------------

    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 1996 Annual Report. Except as disclosed herein, there
has been no material change to the information presented in the footnotes to the
1996 Annual Report.
 
    In the opinion of management, all adjustments (consisting of normal and
recurring adjustments) considered necessary to present fairly the financial
position at March 31, 1997 and December 31, 1996 and results of operations for
the three month periods ended March 31, 1997 and 1996 have been made and are
reflected.
 
NOTE 2 - CASH
 
    At March 31, 1997, the Trust had $10,265,000 invested in reverse repurchase
agreements secured by U.S. Treasury Bills or interests in U.S. Government
securities. Approximately, $9,000,000 of the Trust's cash is expected to be used
to acquire reinvestment equipment in 1997 and 1998.
 
NOTE 3 - REVENUE RECOGNITION
 
    Rents are payable to the Trust monthly, quarterly or semi-annually and no
significant amounts are calculated on factors other than the passage of time.
Rents from Reno Air, Inc. ("Reno Air"), as provided for in the lease agreement,
are adjusted monthly for changes in the London Inter-Bank Offered Rate
("LIBOR"). Future rents from Reno Air, included below, reflect the most recent
LIBOR effected rental payment. The leases are accounted for as operating leases
and are noncancellable. Rents received prior to their due dates are deferred.
Future minimum rents of $44,179,651 are due as follows:
 
<TABLE>
<S>                                                      <C>
   For the year ending March 31, 1998                    $16,901,138
                                 1999                     12,074,480
                                 2000                      8,122,016
                                 2001                      3,432,287
                                 2002                      2,550,776
                           Thereafter                      1,098,954
                                                         -----------

                                Total                    $44,179,651
                                                         ===========
</TABLE>
 
                                       6
<PAGE>

                             AFG Investment Trust D
                       NOTES TO THE FINANCIAL STATEMENTS 
 
                                  (Continued)
 
 
NOTE 4 - EQUIPMENT
------------------


    The following is a summary of equipment owned by the Trust at March 31,
1997. In the opinion of Equis Financial Group ("EFG"), (formerly American
Finance Group), the acquisition cost of the equipment did not exceed its fair
market value.
 
<TABLE>
<CAPTION>
                                                      REMAINING
                                                      LEASE TERM                  EQUIPMENT
         EQUIPMENT TYPE                                (MONTHS)                    AT COST
--------------------------------------             ------------------          -------------
<S>                                                       <C>                  <C>
Aircraft..............................                    9-71                 $  22,779,945
Locomotives...........................                   26-40                    17,205,933
Vessels...............................                      67                    13,875,360
Computers and peripherals.............                    1-23                     6,953,607
Construction and mining...............                   12-46                     6,205,962
Materials handling....................                    9-61                     6,124,033
Retail store fixtures.................                    3-34                     4,930,049
Manufacturing.........................                   14-21                     3,849,128
Miscellaneous.........................                    9-45                     3,564,568
Communications........................                    9-11                     1,834,800
Tractors & heavy duty trucks..........                    1-22                     1,255,967
Trailers/intermodal containers........                   15-37                       812,037
Research & test.......................                    1-37                       664,901
Furniture & fixtures..................                    9-11                       271,945
Photocopying..........................                      --                        65,711
Motor vehicles........................                      21                        38,499
                                                        ------                 -------------
                                          Total equipment cost                   90,432,445
                                      Accumulated depreciation                  (32,228,269)
                                                                               -------------
                     Equipment, net of accumulated depreciation                $  58,204,176
                                                                               -------------
                                                                               -------------
</TABLE>
 
    At March 31, 1997, the Trust's equipment portfolio included equipment having
a proportionate original cost of $15,368,258, representing approximately 17% of
total equipment cost.
 
    At March 31, 1997, the Trust was not holding any equipment not subject to a
lease and no equipment was held for sale or re-lease.
 
NOTE 5 - RELATED PARTY TRANSACTIONS
 
    All operating expenses incurred by the Trust are paid by EFG on behalf of
the Trust and EFG is reimbursed at its actual cost for such expenditures. Fees
and other costs incurred during the three month periods ended March 31, 1997 
and 1996, which were paid or accrued by the Trust to EFG or its Affiliates, 
are as follows:
 
                                       7
<PAGE>
                            AFG Investment Trust D

                          NOTES TO THE FINANCIAL STATEMENTS 

                                    (CONTINUED) 
 
 
<TABLE>
<CAPTION>
                                                                           1997        1996
                                                                        ----------  ----------
<S>                                                                     <C>         <C>
Equipment acquisition fees............................................          --  $   36,109
Equipment management fees.............................................  $  219,681     246,928
Administrative charges................................................      12,159       5,250
Reimbursable operating expenses 
   due to third parties...............................................     128,443     158,345
                                                                        ----------   ---------
                          Total.......................................  $  360,283  $  446,632
                                                                        ==========  ==========
</TABLE>
 
    All rents and proceeds from the sale of equipment are paid directly to
either EFG or to a lender. EFG temporarily deposits collected funds in a
separate interest-bearing escrow account prior to remittance to the Trust. At
March 31, 1997, the Trust was owed $360,829 by EFG for such funds and the
interest thereon. These funds were remitted to the Trust in April 1997.
 
NOTE 6 - NOTES PAYABLE
----------------------

    Notes payable at March 31, 1997 consisted of installment notes of
$29,594,007 payable to banks and institutional lenders. The notes bear interest
rates ranging between 5.1% and 13.75%, except for one note which bears a
fluctuating interest rate based on LIBOR plus a margin (5.7% at March 31, 1997).
All of the installment notes are non-recourse, and are collateralized by the
equipment and assignment of the related lease payments. Generally, the
installment notes will be fully amortized by noncancellable rents. However, the
Trust has balloon payment obligations of $282,421 and $1,476,981 at the
expiration of the primary lease terms related to the Reno Aircraft and certain
rail equipment, respectively. The carrying value of notes payable approximates
fair value at March 31, 1997.
 
   The annual maturities of the notes payable are as follows:
 
<TABLE>
   <S>                                                   <C>
   For the year ending March 31, 1998                 $ 11,170,175
                                 1999                    7,028,205
                                 2000                    4,937,002
                                 2001                    3,594,363
                                 2002                    1,771,575
                           Thereafter                    1,092,687
                                                      ------------
                                Total                 $ 29,594,007
                                                     =============
</TABLE>
 
NOTE 7 - LEGAL PROCEEDINGS
--------------------------

    On July 27, 1995, EFG, on behalf of the Trust and other EFG-sponsored
investment programs, filed an action in the Commonwealth of Massachusetts
Superior Court Department of the Trial Court in and for the County of Suffolk,
for damages and declaratory relief against a lessee of the Trust, National Steel
Corporation ("National Steel"), under a certain Master Lease Agreement ("MLA")
for the lease of certain equipment. EFG is seeking the reimbursement by National
Steel of certain sales and/or use taxes paid to the State of Illinois and other
remedies provided by the MLA. On August 30, 1995, National Steel filed a Notice 
of Removal which removed the case to the United States District Court,
District of Massachusetts. On September 7, 1995, National Steel filed its Answer
to EFG's Complaint along with Affirmative Defenses and Counterclaims, seeking
declaratory relief and alleging
 
                                       8

<PAGE>
                              AFG Investment Trust D

                         NOTES TO THE FINANCIAL STATEMENTS 
                                    (CONTINUED)


breach of contract, implied covenant of good faith and fair dealing and 
specific performance. EFG filed its Answer to these
counterclaims on September 29, 1995. Though the parties have been discussing
settlement with respect to this matter for some time, to date, the negotiations
have been unsuccessful. Notwithstanding these discussions, EFG recently filed an
Amended and Supplemental Complaint alleging a further default by National Steel
under the MLA and EFG recently filed a Summary Judgment on all claims and
counterclaims. The matter remains pending before the Court. The Trust has not
experienced any material losses as a result of this action.
 
NOTE 8 - SOLICITATION AND REGISTRATION STATEMENTS
------------------------------------------------ 

    On October 26, 1996, the Managing Trustee, on behalf of the Trust, filed a
Solicitation Statement with the Securities and Exchange Commission which was
subsequently sent to the Beneficiaries pursuant to Regulation 14A of Section 14
of the Securities Exchange Act. The Solicitation Statement sought to solicit the
consent of the Beneficiaries to a proposed amendment ("the Amendment") to the
Amended and Restated Declaration of Trust (the "Trust Agreement").
 
    The Amendment would (i) amend the provisions of the Trust Agreement
governing the redemption of Interests to permit the Trust to offer to redeem
outstanding interests at such times, in such amounts, in such manner and at such
prices as the Managing Trustee may determine from time to time, in accordance
with applicable law; and (ii) add a provision to the Trust Agreement that would
permit the Trust to issue, at the discretion of the Managing Trustee and without
further consent or approval of the Beneficiaries, an additional class of
security with such designations, preferences and relative, participating,
optional or other special rights, powers and duties as the Managing Trustee may
fix. Such a security, if it were to be offered and sold, would provide the Trust
with the funds to (a) implement more expansive Interest redemption opportunities
for Beneficiaries without using Trust funds which may otherwise be available for
current cash distributions; and (b) make a special one-time distribution to the
Beneficiaries.
 
    Pursuant to the Trust Agreement, the adoption of the Amendment required the
consent of the Beneficiaries holding more than fifty percent in the aggregate of
the Interests held by all Beneficiaries. A majority of Beneficiary Interests,
representing 1,210,746 or 58% of all Beneficiary Interests, voted in favor of
the Amendment; 229,836 or 11% of all Beneficiary Interests voted against the
Amendment; and 39,233 or 2% of all Beneficiary Interests abstained.
Approximately 71% of all Beneficiary Interests participated in the vote.
Accordingly, the Amendment was adopted.
 
    On February 12, 1997, the Trust filed a Registration Statement on Form S-1
(which was amended on April 11, 1997 and May 9, 1997) with the Securities and
Exchange Commission which covers, among other things, the creation and sale of a
new class of beneficiary interests in the Trust (the "Class B Interests"). A
portion of the proceeds from the offering of the Class B Interests would be used
to make a one-time special cash distribution to existing Beneficiaries (the
"Class A Beneficiaries") of the Trust and to enable the Trust to redeem a
portion of the existing Beneficiary Interests (the "Class A Interests"). The
characteristics of the Class B Interests, associated risk factors, and other
matters of importance to the Beneficiaries and prospective purchasers of the
Class B Interests are contained in the Registration Statement. Presently, the
Registration Statement is undergoing regulatory review and has not been declared
effective.
 
                                       9

<PAGE>

                             AFG INVESTMENT TRUST D
 
                                   FORM 10-Q
 
                         PART I. FINANCIAL INFORMATION
 
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
-----------------------------------------------------------------------
RESULTS OF OPERATIONS.
----------------------
 
Three months ended March 31, 1997 compared to the three months ended March 
--------------------------------------------------------------------------
31, 1996:
---------


OVERVIEW
 
    As an equipment leasing trust, the Trust was organized to acquire a
diversified portfolio of capital equipment subject to lease agreements with
third parties. The Trust was designed to progress through three principal
phases: acquisitions, operations, and liquidation. During the operations phase,
a period of approximately six years, all equipment in the Trust's portfolio will
progress through various stages. Initially, all equipment will generate rental
revenues under primary term lease agreements. During the life of the Trust,
these agreements will expire on an intermittent basis and equipment held
pursuant to the related leases will be renewed, re-leased or sold, depending on
prevailing market conditions and the assessment of such conditions by EFG to
obtain the most advantageous economic benefit. Over time, a greater portion of
the Trust's original equipment portfolio will become available for remarketing
and cash generated from operations and from sales or refinancings will begin to
fluctuate. Ultimately, all equipment will be sold and the Trust will be
dissolved. The Trust's operations commenced in 1993.
 
RESULTS OF OPERATIONS
---------------------
 
    For the three months ended March 31, 1997, the Trust recognized lease
revenue of $4,759,553 compared to $5,600,700 for the three months ended March
31, 1996. The decrease in lease revenue from 1996 to 1997 was primarily
attributable to the Trust's sale of its interest in a vessel to the lessee in
December 1996. In the near-term, aggregate rental revenues are expected to
increase due to reinvestment of available proceeds in other equipment, including
proceeds resulting from the Trust's sale of its interest in the vessel discussed
above. Over time, the level of lease revenue will decline due to the expiration
of the Trust's primary lease term agreements.
 
    The Trust's equipment portfolio includes certain assets in which the Trust
holds a proportionate ownership interest. In such cases, the remaining interests
are owned by EFG or an affiliated equipment leasing program sponsored by EFG.
Proportionate equipment ownership enables the Trust to further diversify its
equipment portfolio by participating in the ownership of selected assets,
thereby reducing the general levels of risk which could result from a
concentration in any single equipment type, industry or lessee. The Trust and
each affiliate individually report, in proportion to their respective ownership
interests, their respective shares of assets, liabilities, revenues, and
expenses associated with the equipment.
 
    Interest income for the three months ended March 31, 1997 was $121,151,
compared to $13,821 for the same period in 1996. Interest income was generated
from temporary investment of available cash in short-term money market
instruments. Interest income was higher in the three months ended March 31, 1997
than in the same period in 1996 due to interest earned on sale proceeds
associated with the vessel discussed above. The amount of future interest income
is expected to fluctuate in relation to prevailing interest rates and the
collection of lease revenue and equipment sales proceeds.
 
    For the three months ended March 31, 1997, the Trust sold equipment having a
net book value of $11,446 to existing lessees and third parties. These sales
resulted in a net loss for financial statement purposes, of $4,946 compared to a
net loss of $90,565 on equipment having a net book value of $357,510 for the
same period in 1996.
 
    It cannot be determined whether future sales of equipment will result in a
net gain or a net loss to the Trust, as such transactions will be dependent upon
the condition and type of equipment being sold and its marketability 

                                           10

<PAGE>


                                 AFG Investment Trust D

                                      Form 10-Q

                            PART 1. FINANCIAL INFORMATION 


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 Trust 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 revenue 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 Trust 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 Trust achieved from leasing the equipment.
 
    Depreciation and amortization expense was $3,142,119 and $3,541,915 for the
three months ended March 31, 1997 and 1996, respectively. For financial
reporting purposes, to the extent that an asset is held on primary lease term,
the Trust 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 asset is held beyond its primary lease term, the Trust continues to
depreciate the remaining net book value of the asset on a straight-line basis
over the asset's remaining economic life.
 
    Interest expense was $654,992 or 13.8% of lease revenue for the three months
ended March 31, 1997 and $892,672 or 15.9% of lease revenue for the same period
in 1996. Interest expense in the near-term is expected to increase due to
anticipated leveraging to be obtained to finance the acquisition of reinvestment
equipment, discussed above. Thereafter, interest expense will decline in amount
and as a percentage of lease revenue as the principal balance of notes payable
is reduced through the application of rent receipts to outstanding indebtedness.
 
    Management fees were 4.6% and 4.4% of lease revenue for the three months
ended March 31, 1997 and 1996, 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.
 
    Operating expenses consist principally of administrative charges,
professional service costs, such as audit and legal fees, as well as printing,
distribution and remarketing expenses. Collectively, operating expenses
represented approximately 3% of lease revenue during the three months ended
March 31, 1997 and approximately 2.9% of lease revenue during the same period in
1996. The increase in operating expenses from 1996 to 1997 was due primarily to
professional service costs incurred in connection with the Solicitation and
Registration Statements described in Note 8 to the accompanying financial
statements. The amount of future operating expenses cannot be predicted with
certainty; however, such expenses are usually higher during the acquisition and
liquidation phases of a trust. Other fluctuations typically occur in relation to
the volume and timing of remarketing activities.
 

LIQUIDITY AND CAPITAL RESOURCES AND DISCUSSION OF CASH FLOWS
------------------------------------------------------------

    The Trust by its nature is a limited life entity which was established for
specific purposes described in the preceding "Overview". As an equipment leasing
program, the Trust's principal operating activities derive from 


                                       11

<PAGE>

                                 AFG Investment Trust D    
                                                           
                                      Form 10-Q            
                                                           
                            PART 1. FINANCIAL INFORMATION  

asset rental transactions. Accordingly, the Trust's principal source of cash 
from operations is provided by the collection of periodic rents. These cash 
inflows are used to satisfy debt service obligations associated with 
leveraged leases, and to pay management fees and operating costs. For the 
three months ended March 31, 1997, operating activities generated net cash 
inflows of $4,315,994, after reductions for equipment sale proceeds of 
approximately $1,618,000 received in connection with the sale of the vessel 
and debt proceeds of $1,980,073 which relate to the leveraging of certain 
rail equipment in the Trust's portfolio. These sale and debt proceeds were 
due from EFG at December 31, 1996. For the three months ended March 31, 1996, 
the Trust generated net cash inflows from operating activities of $4,935,287. 
In the near-term, net cash inflows generated from operating activities are 
expected to increase due to the acquisition of reinvestment equipment as 
described below. Thereafter, renewal, re-lease and equipment sale activities 
will cause the Trust's primary-term lease revenue and corresponding sources 
of operating cash to decline. Overall, expenses associated with rental 
activities, such as management fees, and net cash flow from operating 
activities will decline as the Trust experiences a higher frequency of 
remarketing events.
 
    The Trust's equipment is leased by a number of creditworthy,
investment-grade companies and, to date, the Trust has not experienced any
material collection problems and has not considered it necessary to provide an
allowance for doubtful accounts. Notwithstanding a positive collection history,
there is no assurance that all future contracted rents will be collected or that
the credit quality of the Trust's lessees will be maintained. Collection risk
could increase in the future, particularly as the Trust remarkets its equipment
and enters re-lease agreements with different lessees. The Managing Trustee will
continue to evaluate and monitor the Trust's experience in collecting accounts
receivable to determine whether a future allowance for doubtful accounts may
become appropriate.
 
    Ultimately, the Trust will dispose of all assets under lease. This will
occur principally through sale transactions whereby each asset will be sold to
the existing lessee or to a third party. Generally, this will occur upon
expiration of each asset's primary or renewal/re-lease term. In certain
instances, casualty or early termination events may result in the disposal of an
asset. Such circumstances are infrequent and usually result in the collection of
stipulated cash settlements pursuant to terms and conditions contained in the
underlying lease agreements.
 
    Cash expended for asset acquisitions and cash realized from asset disposal
transactions are reported under investing activities on the accompanying
Statement of Cash Flows. The Trust expended $1,239,741 to acquire equipment
during the three months ended March 31, 1996, pursuant to the reinvestment
provisions of the Trust's prospectus. The reinvestment equipment was financed
through a combination of leveraging and sale proceeds. During the three months
ended March 31, 1997, the Trust realized equipment sale proceeds of $6,500,
compared to $266,945 during the same period in 1996 Future inflows of cash from
asset disposals will vary in timing and amount and will be influenced by many
factors including, but not limited to the frequency and timing of lease
expirations, the type of equipment being sold, its condition and age, and future
market conditions.
 
    The Trust obtained long-term financing in connection with certain 
equipment leases. The origination of such indebtedness and the subsequent 
repayments of principal are reported as components of financing activities. 
Cash inflows of $997,888 in 1996 resulted from leveraging a portion of the 
Trust's equipment portfolio with third-party lenders. Each note payable is 
recourse only to the specific equipment financed and to the minimum rental 
payments contracted to be received during the debt amortization period (which 
period generally coincides with the lease rental term). As rental payments 
are collected, a portion or all of the rental payment is used to repay the 
associated indebtedness. The amount of cash used to repay debt during the 
three months ended March 31, 1997 increased as a result of leveraging 
obtained in 1996. In the near-term, the amount of cash used to repay debt 
obligations will continue to increase as a result of anticipated leveraging 
to be obtained in connection with the acquisition of reinvestment equipment. 
Thereafter, the amount will decline as the principal balance of notes payable 
is reduced through the collection and application of rents. However, the 
Trust has balloon payment obligations of $282,421 and $1,476,981 at the 
expiration of the primary lease terms related to the Trust's

                                       12

<PAGE>

                                 AFG Investment Trust D    
                                                           
                                      Form 10-Q            
                                                           
                            PART 1. FINANCIAL INFORMATION  


proportionate ownership interest in an MD-87 jet aircraft leased by Reno Air,
Inc. and certain rail equipment, respectively.
 
    Cash distributions to the Managing Trustee, the Special Beneficiary and the
Beneficiaries are declared and generally paid within fifteen days following the
end of each month. The payment of such distributions is presented as a component
of financing activities. For the three months ended March 31, 1997, the Trust
declared total cash distributions of Distributable Cash From Operations and
Distributable Cash From Sales and Refinancings of $942,653. In accordance with
the Trust Agreement, the Beneficiaries were allocated 90.75% of these
distributions, or $855,458; the Special Beneficiary was allocated 8.25% or
$77,769; and the Managing Trustee was allocated 1%, or $9,426.
 
    For financial reporting purposes, the Managing Trustee and the Special
Beneficiary each has accumulated a capital deficit at March 31, 1997. This is
the result of aggregate cash distributions to these Participants being in excess
of their aggregate capital contributions ($1,000 each) and their respective
allocations of financial statement net income or loss. Ultimately, the existence
of a capital deficit for the Managing Trustee or the Special Beneficiary for
financial reporting purposes is not indicative of any further capital
obligations to the Trust by either the Managing Trustee or the Special
Beneficiary. However, for income tax purposes, the Trust Agreement requires that
income be allocated first to those Participants having negative tax capital
account balances so as to eliminate any such balances. In accordance with the
Trust Agreement, upon the dissolution of the Trust, the Managing Trustee will be
required to contribute to the Trust an amount equal to any negative balance
which may exist in the Managing Trustee's tax capital account. No such
requirement exists with respect to the Special Beneficiary. At December 31,
1996, the Managing Trustee had a positive tax capital account balance.
 
    At March 31, 1997, the Trust had aggregate future minimum lease payments of
$44,179,651 from contractual lease agreements (see Note 3 to the financial
statements), of which $29,594,007 will be used to amortize the principal balance
of notes payable (see Note 6 to the financial statements). Additional cash
inflows will be realized from future remarketing activities, such as lease
renewals and equipment sales, as well as from lease revenues generated by
equipment acquisitions from the Trust's anticipated reinvestment activities.
Presently, the Trust expects to acquire approximately $36,000,000 of
reinvestment equipment using cash of approximately $9,000,000 and additional
indebtedness, which will be amortized from the associated rental streams.
However, the extent of the Trust's total future reinvestment activities may
exceed this projection as a result of future equipment sales, the timing and
extent of which cannot be predicted with certainty. This is because the timing
and extent of equipment sales is often dependent upon the needs and interests of
the existing lessees. Some lessees may choose to renew their lease contracts,
while others may elect to return the equipment. In the latter instances, the
equipment could be re-leased to another lessee or sold to a third party.
Accordingly, as the Trust matures and a greater level of its equipment assets
become available for remarketing, the cash flows of the Trust will become less
predictable. In addition, the Trust will have cash outflows to satisfy interest
on indebtedness and to pay management fees and operating expenses. Ultimately,
the Trust is expected to meet its future disbursement obligations and to
distribute any excess of cash inflows over cash outflows to the Participants in
accordance with the Trust Agreement. However, several factors, including
month-to-month lease extensions, lessee defaults, equipment casualty events, and
early lease terminations could alter the Trust's anticipated cash flows as
described herein and in the accompanying financial statements and result in
fluctuations to the Trust's periodic cash distribution payments.
 
    Cash distributions paid to the Participants consist of both a return of and
a return on capital. Cash distributions do not represent and are not indicative
of yield on investment. Actual yield on investment cannot be determined with any
certainty until conclusion of the Trust and will be dependent upon the
collection of all future contracted rents, the generation of renewal and/or
re-lease rents, and the residual value realized for each asset at its 
disposal date. Future market conditions, technological changes, the ability 
of EFG to manage and remarket the
 
                                       13
<PAGE>


                                 AFG Investment Trust D    
                                                           
                                      Form 10-Q            
                                                           
                            PART 1. FINANCIAL INFORMATION  


assets, and many other events and circumstances, could enhance or detract from 
individual asset yields and the collective performance of the Trust's equipment 
portfolio.
 
    It is the intention of the Managing Trustee to maintain a cash distribution
level that is consistent with the operating cash flows of the Trust and to
optimize the long-term value of the Trust. A distribution level that is higher
than the Trust's operating cash flows could compromise the Trust's working
capital position, as well as its ability to refurbish or upgrade equipment in
response to lessee requirements or other market circumstances and, during its
reinvestment period, to purchase replacement equipment as original equipment is
remarketed. Accordingly, in order to better align monthly cash distributions
with the Trust's operating cash flows, the Managing Trustee reduced the level of
monthly cash distributions from an annualized rate of $2.52 per Beneficiary
Interest (the rate established and paid from the Trust's inception through
September 1995) to an annualized rate of $1.26 per Beneficiary Interest
commencing in October 1995. In October 1996, the Managing Trustee increased the
annualized distribution rate to $1.64 per Beneficiary Interest and expects that
the Trust will be able to sustain this distribution rate throughout 1997.
However, the nature of the Trust's principal cash flows gradually will shift
from rental receipts to equipment sale proceeds as the Trust matures. As this
occurs, the Trust's cash flows will become more volatile in that certain of the
Trust's equipment leases will be renewed and certain of its assets will be sold.
In some cases, the Trust may be required to expend funds to refurbish or
otherwise improve the equipment being remarketed in order to make it more
desirable to a potential lessee or purchaser. The Trust's Advisor, EFG, and the
Managing Trustee will attempt to monitor and manage these events to maximize the
residual value of the Trust's equipment and will consider these factors, in
addition to the collection of contractual rents, the retirement of scheduled
indebtedness and the Trust's future working capital and equipment requirements,
in establishing future cash distribution rates. Ultimately, the Participants
should expect that cash distribution rates will fluctuate over the long term as
a result of future remarketing activities.


                                       14
<PAGE> 

                                AFG INVESTMENT TRUST D
 
                                     FORM 10-Q
 
                           PART II. OTHER INFORMATION
 
<TABLE>
<S>                                            <C>
     Item 1.                     Legal Proceedings 
                                 Response:

                                 Refer to Note 7 to the financial statements
                                 herein.

     Item 2.                     Changes in Securities 
                                 Response: None

     Item 3.                     Defaults upon Senior Securities 
                                 Response: None

     Item 4.                     Submission of Matters to a Vote of Security Holders 
                                 Response: None

     Item 5.                     Other Information 
                                 Response: None

     Item 6(a).                  Exhibits 
                                 Response: None

     Item 6(b).                  Reports on Form 8-K 
                                 Response: None
     </TABLE>


                                       15

<PAGE>
                                 SIGNATURE PAGE
 
    Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below on behalf of the registrant and in the capacity and
on the date indicated.
 
                             AFG INVESTMENT TRUST D
 
<TABLE>
           <S>       <C>
           By:       AFG ASIT Corporation, a Massachusetts
                     corporation and the Managing Trustee of 
                     the Registrant. 



           By:       /s/ Michael J. Butterfield 
                     ---------------------------------------------
                     Michael J. Butterfield 
                     Treasurer of AFG ASIT Corporation
                     (Duly Authorized Officer and 
                     Principal Accounting Officer)



           Date:     May 15, 1997 
                     ---------------------------------------------



           By:       /s/ Gary Romano 
                     --------------------------------------------
                     Gary M. Romano 
                     Clerk of AFG ASIT Corporation 
                     (Duly Authorized Officer and
                     Principal Financial Officer)



           Date:     May 15, 1997
                     ---------------------------------------------
</TABLE>
 


                                       16