Page 1 of 31


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


                                    FORM 10-K

__X__   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT OF 1934 (FEE REQUIRED)

For the fiscal year ended December 31, 1995

Commission File Number 0-15287

                    PHOENIX LEASING CASH DISTRIBUTION FUND II
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

           California                                   68-0032426
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

2401 Kerner Boulevard, San Rafael, California                    94901-5527
--------------------------------------------------------------------------------
(Address of principal executive offices)                         (Zip Code)

Registrant's telephone number, including area code:     (415) 485-4500
                                                        --------------

Securities registered pursuant to Section 12(b) of the Act:  NONE

Securities registered pursuant to Section 12(g) of the Act:  Units of Limited 
                                                            Partnership Interest

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.
           -----

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 ___    No _X_

As of December 31, 1995,  379,583  Units of Limited  Partnership  interest  were
outstanding.  No  market  exists  for the  Units  of  Partnership  interest  and
therefore there exists no aggregate market value at December 31, 1995.

                    DOCUMENTS INCORPORATED BY REFERENCE: NONE




<PAGE>


                                                                    Page 2 of 31




                    PHOENIX LEASING CASH DISTRIBUTION FUND II

                          1995 FORM 10-K ANNUAL REPORT


                                TABLE OF CONTENTS


                                                                            Page

                                     PART I

Item 1.          Business.................................................    3
Item 2.          Properties...............................................    5
Item 3.          Legal Proceedings........................................    6
Item 4.          Submission of Matters to a Vote of Security Holders......    6


                                     PART II

Item 5.          Market for the Registrant's Securities and Related 
                 Security Holder Matters..................................    6
Item 6.          Selected Financial Data..................................    6
Item 7.          Management's Discussion and Analysis of Financial 
                 Condition and Results of Operations......................    7
Item 8.          Financial Statements and Supplementary Data..............    9
Item 9.          Disagreements on Accounting and Financial Disclosure 
                 Matters..................................................   26


                                    PART III

Item 10.         Directors and Executive Officers of the Registrant.......   26
Item 11.         Executive Compensation...................................   27
Item 12.         Security Ownership of Certain Beneficial Owners and 
                 Management...............................................   27
Item 13.         Certain Relationships and Related Transactions...........   28


                                     PART IV

Item 14.         Exhibits, Financial Statement Schedules and Reports on 
                 Form 8-K.................................................   28


Signatures ...............................................................   30


<PAGE>


                                                                    Page 3 of 31

                                     PART I

Item 1.       Business.

General Development of Business.

         Phoenix  Leasing  Cash  Distribution  Fund  II,  a  California  limited
partnership (the "Partnership"), was organized on June 28, 1984. The Partnership
was registered  with the Securities  and Exchange  Commission  with an effective
date of November 20, 1986 and shall  continue to operate  until its  termination
date unless dissolved sooner due to the sale of substantially  all of the assets
of the  Partnership  or a vote of the Limited  Partners.  The  Partnership  will
terminate  on  December  31,  1997.  The  General  Partner  is  Phoenix  Leasing
Incorporated,  a California  corporation.  The General Partner or its affiliates
also is or has been a general  partner in  several  other  limited  partnerships
formed to invest in capital equipment and other assets.

         The initial  registration was for 300,000 units of limited  partnership
interest  at a price of $250 per unit with an option of  increasing  the  public
offering up to a maximum of 400,000 units.  The  Partnership  sold 386,308 units
for a total capitalization of $96,577,000.  Of the proceeds received through the
offering,  the  Partnership  has  incurred  $11,540,000  in  organizational  and
offering expenses.  The Partnership concluded its public offering on February 4,
1988.

         Phoenix Concept Cablevision Inc. (the "Subsidiary") is a majority owned
subsidiary  of the  Partnership  (hereinafter,  both  entities are  collectively
referred to as the "Consolidated Partnership").  The Subsidiary was formed under
the laws of Nevada on December 22, 1992. The Partnership owns  approximately 58%
of the outstanding  shares of Phoenix Concept  Cablevision  Inc. Phoenix Concept
Cablevision Inc. owns 100% of the outstanding  shares of Concept  Cablevision of
South  Carolina,  Inc., a Delaware  corporation.  Concept  Cablevision  of South
Carolina,  Inc. owns and operates a cable television system located in the state
of South Carolina.

Narrative Description of Business.

         The  Consolidated  Partnership  conducts  its  business in two business
segments:  Equipment  Leasing and  Financing  Operations,  and Cable  Television
System Operations. A discussion of these two segments follows:

Equipment Leasing and Financing Operations.

         From the initial  formation  of the  Partnership  through  December 31,
1995,  the total  investments  in equipment  leases and  financing  transactions
(loans),  including the  Partnership's  pro rata interest in investments made by
joint  ventures,  approximate  $175,590,000.  The average  initial  firm term of
contractual  payments from equipment subject to lease was 32.19 months,  and the
average  initial  net  monthly  payment  rate as a  percentage  of the  original
purchase price was 2.24%. The average initial firm term of contractual  payments
from loans was 82.01 months.

         The  Partnership's  principal  objective is to produce cash flow to the
investors on a  continuing  basis over the life of the  Partnership.  To achieve
this  objective,  the  Partnership  has  invested  in  various  types of capital
equipment and other assets to provide  leasing or financing of the same to third
parties, including Fortune 1000 companies and their subsidiaries,  middle-market
companies,  emerging growth companies, cable television operators and others, on
either  a  long-term  or  short-term  basis.  The  types of  equipment  that the
Partnership has invested in includes  computer  peripherals,  terminal  systems,
small computer systems,  communications equipment, IBM mainframes,  IBM-software
compatible mainframes, office systems, CAE/CAD/CAM equipment, telecommunications
equipment,  cable  television  equipment,  medical  equipment,   production  and
manufacturing equipment and software products.

         The  Partnership  has made secured loans to cable  television  systems,
emerging growth companies,  security monitoring  companies and other businesses.
These loans are asset-based and the Partnership  receives a security interest in
the assets financed.

         The  Partnership's  financing  activities have been concentrated in the
cable  television  industry.  The  Partnership  has made  secured  loans  (notes
receivable)  to  operators  of cable  television  systems  for the  acquisition,
refinancing,  construction,  upgrade  and  extension  of  such  systems  located
throughout the United States. The loans to cable television system operators are
secured  by a  senior  or  subordinated  interest  in the  assets  of the  cable
television  system,  its  franchise   agreements,   subscriber  lists,  material
contracts  and other  related  assets.  In some cases the  Partnership  has also
received  personal  guarantees  from the owners of the systems.  At December 31,
1995, the Partnership's  remaining  investments in notes receivable consist of a
note receivable from one cable television  system operator and a note receivable
from a security  monitoring  company.  The Partnership's net investment in notes
receivable before  consideration of the allowance for losses on notes receivable
<PAGE>


                                                                    Page 4 of 31


approximates 28% of the total assets of the Partnership at December 31, 1995.

         Several  of the  cable  television  system  operators  the  Partnership
provided   financing  to  have   experienced   financial   difficulties.   These
difficulties  are  believed  to have been caused by several  factors  such as: a
significant reduction in the availability of debt from banks and other financial
institutions to finance  acquisitions and operations,  uncertainties  related to
future government  regulation in the cable television  industry and the economic
recession in the United  States.  These  factors have  resulted in a significant
decline in the demand for the  acquisition  of cable  systems  and have  further
caused an overall decrease in the value of many cable television  systems.  As a
result of the  above,  many of the  Partnership's  notes  receivable  from cable
television  system  operators  have gone into  default.  The  result is that the
Partnership  has  not  received  scheduled  payments,  has  had  to  grant  loan
extensions,  has  experienced an increase in legal and  collection  costs and in
some cases, has had to foreclose on the cable television  system.  The impact of
this has been a decrease in the overall return on the Partnership's  investments
in such notes.

         The Partnership has acquired  equipment  pursuant to either "Operating"
leases or  "Financing"  leases.  At December 31, 1995  approximately  71% of the
equipment  owned by the  Partnership  was  classified as Financing  leases.  The
Partnership has also provided  financing  secured by assets in the form of notes
receivable.  Operating  leases are generally  short-term  leases under which the
lessor will receive aggregate rental payments in an amount that is less than the
purchase  price of the  equipment.  Financing  leases are generally for a longer
term under which the non-cancelable  rental payments due during the initial term
of the  lease are at least  sufficient  to  recover  the  purchase  price of the
equipment.

         Competition.  The General Partner has  concentrated  the  Partnership's
activities in the equipment leasing and financing industry, an area in which the
General  Partner has  developed an  expertise.  The computer  equipment  leasing
industry is  extremely  competitive.  The  Partnership  competes  with many well
established   companies  having   substantially   greater  financial  resources.
Competitive  factors include  pricing,  technological  innovation and methods of
financing (including use of various short-term and long-term financing plans, as
well as the  outright  purchase of  equipment).  Generally,  the impact of these
factors to the  Partnership  would be the  realization  of  increased  equipment
remarketing and storage costs, as well as lower residuals received from the sale
or remarketing of such equipment.

Cable Television System Operations.

         Phoenix  Concept  Cablevision,  Inc. (the  "Subsidiary")  is a majority
owned  subsidiary  of the  Partnership.  The  Subsidiary  was  acquired  through
foreclosure of a defaulted note  receivable to the  Partnership on September 15,
1994. The net carrying value of the  Partnership's  share of this defaulted note
receivable  was  approximately  $1,620,000,  which was  exchanged  for an 81.22%
ownership interest in this joint venture. The Partnership owns approximately 58%
of the outstanding shares of Phoenix Concept  Cablevision,  Inc. Phoenix Concept
Cablevision,  Inc. owns 100% of the outstanding shares of Concept Cablevision of
South Carolina, Inc., which owns and operates a cable television system. Phoenix
Cable Management Inc. (PCMI), an affiliate of the General Partner,  provides day
to day management services in connection with the operation of the system.

         Concept  Cablevision of South Carolina,  Inc. owns and operates a cable
television  system  located  in the  state of South  Carolina,  which  currently
consists of two headend  locations and 81 miles of plant  passing  approximately
3,710 homes and has approximately  1,966 cable subscribers at December 31, 1995.
The cable  television  system serves the  communities of Holly Hill, St. George,
Reevesville,  Eutawville,  certain unincorporated areas in Dorchester County and
other  communities  in Orangeburg  County.  The cable system  operates under six
non-exclusive franchise agreements with each of the stated municipalities. These
cable franchise agreements expire between the years 1996 and 2003.

         Cable  television  systems receive signals  transmitted by nearby radio
and television  broadcast  stations,  microwave relay systems and communications
satellites  and distribute  the signals to  subscribers  via coaxial cable.  The
subscribers pay a monthly fee to the cable television  system for such services.
Cable television  companies  operate under a non-exclusive  franchise  agreement
granted by each local government authority.  As part of the franchise agreement,
the  franchisee  typically pays a portion of the gross revenues of the system to
the local government.

         The  Partnership  intends to own and  operate  the cable  system  until
market  conditions  would  enable a sale at  acceptable  terms.  Any excess cash
generated  from  operations  of the cable  system will be used for  upgrades and
improvements to the system in order to maximize the value of the system.

         Competition.  The Partnership's cable operations competes with numerous
other  companies  with far  greater  financial  resources.  In  addition,  cable
television franchises are typically non-exclusive  and the  Partnership could be
<PAGE>


                                                                    Page 5 of 31


directly  competing with other cable television  systems.  Cable television also
competes  with  conventional   over-the-air   broadcast  television  and  direct
broadcast satellite  transmission.  Future  technological  developments may also
provide additional competitive factors.

         The newly passed  Telecommunications Bill allows telephone companies to
enter into the cable television business and vice-versa.  Large cable television
systems that have upgraded their systems with fiber and two way capabilities may
find themselves  getting a piece of the much larger telephone  revenue.  For the
smaller rural cable systems,  such as those owned by the  Partnership or through
investments in joint ventures,  it is unlikely that the  Partnership  will enter
into  telephone  services  nor  will  the  telephone  companies  try to seek our
customers in the near future. The systems owned by the Partnership are too small
and not dense enough to pay for the large amount of capital  expenditures needed
for these services.

         A  favorable  part of the  bill is that  small  cable  systems  will be
immediately deregulated from most regulations and that the definition of a small
cable operator is under 600,000 subscribers.  This will allow small operators to
raise rates if needed,  and eliminate the need to provide franchise  authorities
with costly rate filings and justifications.  The new bill also allows the local
telephone companies to buy out small cable operators in their own region as well
as to joint venture with small cable operators. During 1995, the General Partner
has observed a renewed market interest in small cable systems.  The final impact
of the newly  passed  Telecommunications  Bill will not be known  fully  until a
technical rewrite is completed and all the legal challenges have been made.

         Please  see  Note  15 in the  Partnership's  financial  statements  for
financial information about the Partnership's business segments.

Other.

         A brief  description of the type of assets in which the Partnership has
invested as of December 31, 1995, together with information  concerning the uses
of assets is set forth in Item 2.


Item 2.       Properties.

         The  Partnership  is engaged in the  equipment  leasing  and  financing
industry.  The primary  assets held by the  Partnership  are its  investments in
leases and loans either directly or through its investment in joint ventures.

         As of  December  31,  1995,  the  Partnership  owns  equipment  and has
outstanding  loans to borrowers with an aggregate  original cost of $10,240,000.
The  equipment  and loans have been made to  customers  located  throughout  the
United States.  The following  table  summarizes the type of equipment  owned or
financed by the Partnership,  including its pro rata interest in joint ventures,
at December 31, 1995.

                                                                   Percentage of
            Asset Types                          Purchase Price(1)  Total Assets
            -----------                          ----------------- -------------
                                               (Amounts in Thousands)

Computer Peripherals                                  $ 4,046           40%
Reproduction Equipment                                  2,840           28
Financing Related to Cable Television Systems           1,350           13
Telecommunications                                      1,153           11
Mainframes                                                525            5
Capital Equipment Leased to Emerging
  Growth Companies                                        250            2
Financing of Security Monitoring System Companies          57            1
Small Computer Systems                                     19           --
                                                      -------          ---

TOTAL                                                 $10,240          100%
                                                      =======          ===

(1)  These  amounts  include the  Partnership's  pro rata  interest in equipment
     joint  ventures of  $1,683,000,  cost of equipment  on financing  leases of
     $1,382,000 and original cost of outstanding loans of $1,406,000 at December
     31, 1995



<PAGE>


                                                                    Page 6 of 31


Cable Television System Operations.

         The  Subsidiary's   principal  plants  and  real  property  consist  of
electronic  headend  equipment,  its plant (cable) and two parcels of land.  The
Subsidiary's headends are located on the two parcels of land.


Item 3.       Legal Proceedings.

         The  Registrant is not a party to any pending legal  proceedings  which
would have a material adverse impact on its financial position.


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

         No matters were  submitted to a vote of Limited  Partners,  through the
solicitation of proxies or otherwise, during the year covered by this report.


Item 5.       Market for the Registrant's Securities and Related Security Holder
              Matters.

         (a)  The Registrant's  limited  partnership  interests are not publicly
              traded.   There  is  no  market  for  the   Registrant's   limited
              partnership interests and it is unlikely that any will develop.

         (b)  Approximate number of equity security investments:

                                                  Number of Unit Holders
              Title of Class                      as of December 31, 1995
              --------------                      -----------------------

              Limited Partners                              9,109


                                     PART II

<TABLE>
Item 6.       Selected Financial Data.
<CAPTION>
                                         Amounts in Thousands Except for Per Unit Amounts
                                         ------------------------------------------------
                                     1995          1994(1)     1993         1992          1991
                                     ----          ----        ----         ----          ----
<S>                               <C>          <C>          <C>          <C>           <C>

Total Income                      $  2,868     $  5,095     $  5,613     $ 10,706      $ 14,290

Net Income (Loss)                    1,164        2,925        1,570       (1,540)       (5,429)

Total Assets                         6,150        6,338        6,922       10,168        24,728

Distributions to Partners              949        3,796        3,794       14,269        14,623

Net Income (Loss) per Limited
  Partnership Unit                    3.04         7.63         4.09        (4.01)       (14.09)

Distributions per Limited
  Partnership Unit                    2.50        10.00         9.99        37.54         36.89

</TABLE>
(1) Commencing in 1994,  the amounts  reflect the  consolidated  activity of the
    Partnership and its subsidiary.

         The above selected  financial  data should be read in conjunction  with
the financial statements and related notes appearing elsewhere in this report.



<PAGE>


                                                                    Page 7 of 31


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

Results of Operations

         Phoenix  Leasing  Cash   Distribution   Fund  II  and  Subsidiary  (the
Partnership)  reported net income of $1,164,000  during the year ended  December
31, 1995, as compared to net income of $2,925,000 and $1,570,000 during 1994 and
1993, respectively. The decrease in net income during 1995, as compared to 1994,
is due to a decrease  in rental  income and the  absence  of a  settlement.  The
improvement  in  earnings  during  1994  is  primarily  due to a  settlement  of
$1,180,000 received by the Partnership during 1994.

         Total  revenues  declined by  $2,227,000  during 1995, as compared to a
decline of $418,000 during 1994, when compared to the previous year. The decline
in total  revenues  during  1995,  as compared to 1994,  is due to a decrease in
rental  income of $1,491,000  and the absence of a  settlement.  The decrease in
rental  income for both 1995 and 1994 is a result of a decrease in the amount of
equipment owned by the Partnership.  At December 31, 1995, the Partnership owned
equipment with an aggregate original cost of $7.2 million,  as compared to $16.6
million at December 31, 1994.  As the  Partnership  continues to sell  equipment
upon  expiration  of the  lease  terms,  it is  anticipated  that the  equipment
portfolio  and rental  income  will  continue  to  decrease.  Additionally,  the
Partnership  reported a decreased  gain on the sale of equipment of $378,000 and
$629,000  during  1995 and 1994,  respectively,  due to a decrease in the market
value of equipment sold.  Partially  offsetting these decreases was a settlement
received by the Partnership during 1994 (see Note 9).

         Total  expenses  decreased by $484,000  during 1995,  when  compared to
1994,  due  primarily  to a decrease  of  $456,000  in lease  related  operating
expenses. The decrease in total expense of $1,797,000 during 1994, when compared
to 1993, was due primarily to the decrease in depreciation  and  amortization of
$1,536,000.   The  decrease  in  depreciation  and   amortization   expense  was
attributable  to the decrease in the size of the equipment  portfolio due to the
sale of  equipment  and a large  portion  of the  equipment  having  been  fully
depreciated.  The Partnership sold equipment with an aggregate  original cost of
$9,521,000,  $22,547,000  and  $18,149,000  during the years ended  December 31,
1995, 1994 and 1993, respectively.

         The decrease in lease related  operating  expenses during 1995 and 1994
was due to a decrease in  maintenance,  remarketing  and  refurbishing  expenses
incurred  on a portion of the  Partnership's  reproduction  equipment  purchased
pursuant to a vendor lease and  remarketing  agreement.  In accordance  with the
agreement,  these  expenses  are  deducted  from the rents  and  sales  proceeds
received from such leases and decrease along with the decrease in rental income.

         Inflation  affects the  Partnership  in relation to the current cost of
equipment  placed on lease and the residual  values  realized when the equipment
comes off lease and is sold.  During the last several  years  inflation has been
low, thereby having very little impact upon the Partnership.

Cable Television System Operations

         The Partnership owns a majority  interest in a cable television  system
that it received  through the  foreclosure  on a defaulted  note  receivable  on
September 15, 1994. Only the results of operations  since September 15, 1994 are
included in the  consolidated  results of operations of the  Partnership for the
year ended December 31, 1994. As a result,  this cable television system did not
generate significant revenues during 1994. During 1995, the Partnership reported
cable  subscriber  revenues of $589,000 and total expenses of $590,000 from this
cable television system.

Joint Ventures

         The  Partnership's  increased  earnings  from its  investment  in joint
ventures  during  1995,  as compared to 1994,  is due to a full year of earnings
from the Partnership's  investment in a new equipment leasing joint venture that
was formed on October 28, 1994.  There were no  significant  earnings  from this
joint venture during 1994.


Liquidity and Capital Resources

         The  Partnership's  primary  source of liquidity  comes from  equipment
leasing and financing  activities.  The Partnership has contractual  obligations
with a  diversified  group of  lessees  for fixed  lease  terms at fixed  rental
amounts and will also receive payments on its outstanding notes receivable.  The
Partnership's  future liquidity is dependent upon its receiving  payment of such
contractual obligations. As the initial lease terms expire, the Partnership will

<PAGE>


                                                                    Page 8 of 31


continue  to renew,  remarket or sell the  equipment.  The future  liquidity  in
excess of the  remaining  contractual  obligations  will depend upon the General
Partner's  success in re-leasing and selling the  Partnership's  equipment as it
comes off lease.

         The net cash  generated by equipment  leasing and financing  activities
was  $1,581,000,   $2,052,000  and  $2,647,000   during  1995,  1994  and  1993,
respectively.  The  net  cash  generated  by  equipment  leasing  and  financing
activities  continues  to decline for the same reasons as the decrease in rental
income as previously  discussed.  Proceeds from the sale of equipment  decreased
due to a decrease in the market value of equipment sold.

         The  Partnership  owns equipment being held for lease with an aggregate
original cost of $2,078,000, $3,650,000 and $13,484,000, and a net book value of
$0, $36,000 and $40,000 at December 31, 1995, 1994 and 1993,  respectively.  The
General  Partner  is  actively  engaged,  on  behalf  of  the  Partnership,   in
remarketing and selling the Partnership's off-lease equipment portfolio.

         The cash distributed to partners for the years ended December 31, 1995,
1994 and  1993  were  $949,000,  $3,796,000  and  $3,794,000,  respectively.  In
accordance  with the Limited  Partnership  Agreement,  the limited  partners are
entitled to 95% of the cash available for  distribution  and the General Partner
is entitled to 5%. The limited  partners  received  distributions  of  $949,000,
$3,796,000 and $3,794,000 for the years ended December 31, 1995,  1994 and 1993,
respectively.  The cumulative distributions to Limited Partners are $79,964,000,
$79,015,000 and $75,219,000 at December 31, 1995, 1994 and 1993, respectively.

         The  General  Partner  did not  receive  payment  for its share of cash
distributions  for the  years  ended  December  31,  1995,  1994  and  1993.  In
accordance with the partnership agreement,  upon termination of the Partnership,
the General  Partner is  required to restore any deficit  balance in its capital
account.  During 1992, the General Partner elected to make an early contribution
for such  deficit  capital  balance and is no longer  receiving  payment for its
share of the cash available for distribution.

         The Partnership's  asset portfolio  continues to decline as a result of
the ongoing  liquidation  of assets,  and therefore it is expected that the cash
generated  from  operations  will  also  decline.   As  the  cash  generated  by
Partnership operations continues to decline, the rate of cash distributions made
to limited partners will also decline.  During 1993, the Partnership reduced the
cash  distributions  to partners due to such decline in the cash  available  for
distribution. The Partnership's quarterly distribution to partners in January of
1996 was at the same  rate as the  distributions  made  during  1995.  After the
January 1996 distribution, the Partnership will switch to an annual distribution
with the first annual distribution to be made on January 15, 1997.

         The  Partnership  has been adversely  impacted by several  factors that
have resulted in returns and recovery of  investment  in lower than  anticipated
amounts.  The factors impacting the Partnership have been the economic recession
in the United States, the rate of obsolescence of computer equipment, the market
demand and  remarketability  for equipment owned by the Partnership,  aggressive
manufacturer sales practices and a general  unavailability of debt to companies.
All of these  factors  have  resulted in the decline in revenues and the reduced
distributions to partners.

         Cash  generated  from leasing and financing  operations has been and is
anticipated  to  continue to be  sufficient  to meet the  Partnership's  ongoing
operational expenses and debt service.


<PAGE>


                                                                    Page 9 of 31















Item 8.     CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

            PHOENIX LEASING CASH DISTRIBUTION FUND II AND SUBSIDIARY

                          YEAR ENDED DECEMBER 31, 1995

<PAGE>


                                                                   Page 10 of 31


                         REPORT OF INDEPENDENT AUDITORS


The Partners
Phoenix Leasing Cash Distribution Fund II

We have audited the  consolidated  financial  statements of Phoenix Leasing Cash
Distribution Fund II (a California limited partnership) and Subsidiary listed in
the accompanying  index to financial  statements  (Item 14(a)).  Our audits also
included the  financial  statement  schedule  listed in the Index at Item 14(a).
These  financial  statements  and the  schedule  are the  responsibility  of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements and the schedule 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  and schedule 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 consolidated financial statements listed in the accompanying
index to financial  statements  (Item  14(a))  present  fairly,  in all material
respects  the   consolidated   financial   position  of  Phoenix   Leasing  Cash
Distribution  Fund II and  Subsidiary  at December  31,  1995 and 1994,  and the
consolidated  results of their  operations  and their cash flows for each of the
three years in the period ended December 31, 1995, in conformity  with generally
accepted  accounting  principles.  Also, in our opinion,  the related  financial
statement  schedule,   when  considered  in  relation  to  the  basic  financial
statements  taken as a whole,  presents  fairly  in all  material  respects  the
information set forth therein.


                                                               ERNST & YOUNG LLP


San Francisco, California
  January 19, 1996



<PAGE>

<TABLE>
                                                                                                                 Page 11 of 31


                          PHOENIX LEASING CASH DISTRIBUTION FUND II AND SUBSIDIARY
                                          CONSOLIDATED BALANCE SHEETS
                              (Amounts in Thousands Except for Unit Amounts)
<CAPTION>                                                                                      
                                                                                                  December 31, 
                                                                                            1995                1994
                                                                                            ----                ----
ASSETS
<S>                                                                                     <C>                 <C>
Cash and cash equivalents                                                               $   1,951           $     200

Accounts receivable (net of allowance for losses on
   accounts receivable of $67 and $83 at December 31,
   1995 and 1994, respectively)                                                               110                 209

Notes receivable (net of allowance for losses on notes
   receivable of $358 and $368 at December 31, 1995
   and 1994, respectively)                                                                  1,390               2,039

Equipment on operating leases and held for lease
   (net of accumulated depreciation of $5,061 and
   $13,441 at December 31, 1995 and 1994, respectively)                                        99                 292

Net investment in financing leases                                                            248                 564

Investment in joint ventures                                                                  995               1,488

Cable systems, property and equipment (net of
   accumulated depreciation of $640 and $469 at
   December 31, 1995 and 1994, respectively)                                                  997               1,085

Deferred income tax asset                                                                     118                 142

Other assets                                                                                  242                 319
                                                                                        ---------           ---------

     Total Assets                                                                       $   6,150           $   6,338
                                                                                        =========           =========

LIABILITIES AND PARTNERS' CAPITAL

Liabilities:

   Accounts payable and accrued expenses                                                $     584           $     985

   Minority interest in subsidiary                                                            541                 569
                                                                                        ---------           ---------

     Total Liabilities                                                                      1,125               1,554
                                                                                        ---------           ---------

Partners' Capital:

   General Partner                                                                            104                  92

   Limited Partners, 400,000 units authorized,
     386,308 units issued and 379,583 units
     outstanding at December 31, 1995 and 1994                                              4,895               4,692

   Unrealized gains on available-for-sale securities                                           26                 -
                                                                                        ---------           ---------

     Total Partners' Capital                                                                5,025               4,784
                                                                                        ---------           ---------

     Total Liabilities and Partners' Capital                                            $   6,150           $   6,338
                                                                                        =========           =========

                                            The accompanying notes are an integral
                                                    part of these statements.
</TABLE>
<PAGE>

<TABLE>
                                                                                                              Page 12 of 31


                                   PHOENIX LEASING CASH DISTRIBUTION FUND II AND SUBSIDIARY
                                             CONSOLIDATED STATEMENTS OF OPERATIONS
                                     (Amounts in Thousands Except for Per Unit Amounts)
<CAPTION>
                                                                                 For the Years Ended December 31,
                                                                            1995               1994               1993
                                                                            ----               ----               ----
INCOME
<S>                                                                     <C>                 <C>              <C>
   Rental income                                                        $     842           $  2,333         $    3,779

   Gain on sale of equipment                                                  443                821              1,450

   Equity in earnings (losses) from joint ventures                            342                  6               (100)

   Interest income, notes receivable                                          580                300                294

   Gain on sale of securities                                                 -                  203                -

   Cable subscriber revenue                                                   589                198                -

   Settlement                                                                 -                1,180                -
 
   Other income                                                                72                 54                 90
                                                                        ---------           --------         ----------

     Total Income                                                           2,868              5,095              5,513
                                                                        ---------           --------         ----------

EXPENSES

   Depreciation and amortization                                              488                474              2,010

   Lease related operating expenses                                           346                802              1,081

   Program services, cable systems                                            180                 72                -

   Management fees to General Partner and affiliate                           125                161                230

   Provision for losses on receivables                                         10                  2                111

   Legal expense                                                              156                284                161

   Reimbursed administrative costs to
     General Partner                                                          162                147                139

   General and administrative expenses                                        195                204                211
                                                                        ---------           --------         ----------

     Total Expenses                                                         1,662              2,146              3,943
                                                                        ---------           --------         ----------

NET INCOME BEFORE MINORITY INTEREST
   AND INCOME TAXES                                                     $   1,206           $  2,949         $    1,570

   Minority interest in earnings of subsidiary                                 (3)                (5)               -

   Income tax expense                                                         (39)               (19)               -
                                                                        ---------           --------         ----------

NET INCOME                                                              $   1,164           $  2,925         $    1,570
                                                                        =========           ========         ==========

NET INCOME PER LIMITED
   PARTNERSHIP UNIT                                                     $    3.04           $   7.63         $     4.09
                                                                        =========           ========         ==========

ALLOCATION OF NET INCOME:

   General Partner                                                      $      12           $     29         $       16

   Limited Partners                                                         1,152              2,896              1,554
                                                                        ---------           --------         ----------

                                                                        $   1,164           $  2,925         $    1,570
                                                                        =========           ========         ==========

                                             The accompanying notes are an integral
                                                     part of these statements.
</TABLE>
<PAGE>

<TABLE>
                                                                                                              Page 13 of 31


                                PHOENIX LEASING CASH DISTRIBUTION FUND II AND SUBSIDIARY
                                       CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL
                                      (Amounts in Thousands Except for Unit Amounts)

<CAPTION>
                                                      General
                                                     Partner's         Limited Partners'       Unrealized       Total
                                                      Amount          Units         Amount        Gains         Amount
                                                     ---------       ---------------------     ----------       ------
<S>                                                   <C>             <C>        <C>             <C>         <C>
Balance, December 31, 1992                            $     47        379,583    $    7,832      $   -       $    7,879

Distributions to partners ($9.99 per
   limited partnership unit)                               -              -          (3,794)         -           (3,794)

Net income                                                  16            -           1,554          -            1,570
                                                      --------      ---------    ----------      -------     ----------

Balance, December 31, 1993                                  63        379,583         5,592          -            5,655

Distributions to partners ($10.00 per
   limited partnership unit)                               -              -          (3,796)         -           (3,796)

Net income                                                  29            -           2,896          -            2,925
                                                      --------      ---------    ----------      -------     ----------

Balance, December 31, 1994                                  92        379,583         4,692          -           4,784

Distributions to partners ($2.50 per
   limited partnership unit)                               -              -            (949)         -            (949)

Change for the year in unrealized gains on
   available-for-sale securities                           -              -             -             26             26

Net income                                                  12            -           1,152          -            1,164
                                                      --------      ---------    ----------      -------     ----------

Balance, December 31, 1995                            $    104        379,583    $    4,895      $    26     $    5,025
                                                      ========      =========    ==========      =======     ==========

                                             The accompanying notes are an integral
                                                     part of these statements.
</TABLE>
<PAGE>

<TABLE>
                                                                                                            Page 14 of 31


                            PHOENIX LEASING CASH DISTRIBUTION FUND II AND SUBSIDIARY
                                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                                              (Amounts in Thousands)
<CAPTION>
                                                                    For the Years Ended December 31,
                                                                    1995         1994         1993
                                                                    ----         ----         ----
<S>                                                               <C>          <C>          <C>
Operating Activities:
   Net income                                                     $ 1,164      $ 2,925      $ 1,570
   Adjustments to reconcile net income
     to net cash provided by operating activities:
       Depreciation and amortization                                  488          474        2,010
       Gain on sale of equipment                                     (443)        (821)      (1,450)
       Equity in losses (earnings) from joint ventures               (342)          (6)         100
       Minority interest in earnings of subsidiary                      3            5         --
       Provision for early termination, financing leases             --           --             (4)
       Provision for (recovery of) losses on notes receivable          (7)        --            115
       Provision for losses on accounts receivable                     17            2         --
       Gain on sale of securities                                     (15)        (203)        --
       Decrease in accounts receivable                                 82           90          321
       Decrease in accounts payable, accrued expenses                (391)        (157)        (729)
       Decrease in other assets                                        29         --             38
       Settlement                                                    --           (711)        --
       Decrease in deferred income tax asset                           24           18         --
       Other                                                         --             12         --
                                                                  -------      -------      -------
Net cash provided by operating activities                             609        1,628        1,971
                                                                  -------      -------      -------

Investing Activities:
   Principal payments, financing leases                               316          385          519
   Principal payments, notes receivable                               656           39          157
   Proceeds from sale of equipment                                    428          968        1,857
   Proceeds from sale of securities                                    15          245         --
   Distributions from joint ventures                                  835         --            356
   Purchase of equipment                                              (32)        (813)          (7)
   Investment in financing leases                                    --           --           (185)
   Investment in notes receivable                                    --           (106)        --
   Investment in joint ventures                                      --            (34)        --
   Investment in securities                                          --            (42)        --
   Cable systems, property and equipment                              (86)        (128)        --
   Payment of acquisition fees                                         (1)          (4)         (10)
                                                                  -------      -------      -------
Net cash provided by investing activities                           2,131          510        2,687
                                                                  -------      -------      -------

Financing Activities:
   Payments of principal, notes payable                                (9)        (174)        (291)
   Distributions to minority partners                                 (31)        --           --
   Distributions to partners                                         (949)      (3,796)      (3,794)
                                                                  -------      -------      -------
Net cash used by financing activities                                (989)      (3,970)      (4,085)
                                                                  -------      -------      -------
Increase (decrease) in cash and cash equivalents                    1,751       (1,832)         573
Cash and cash equivalents, beginning of period                        200        2,032        1,459
                                                                  -------      -------      -------
Cash and cash equivalents, end of period                          $ 1,951      $   200      $ 2,032
                                                                  =======      =======      =======

Supplemental Cash Flow Information:
   Cash paid for interest expense                                 $  --        $     3      $    18
   Cash paid for income taxes                                     $    16      $     3      $     5

                                          The accompanying notes are an integral
                                                  part of these statements.
</TABLE>
<PAGE>


                                                                   Page 15 of 31


            PHOENIX LEASING CASH DISTRIBUTION FUND II AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                DECEMBER 31, 1995


Note 1.  Organization and Partnership Matters.

        Phoenix  Leasing  Cash  Distribution  Fund  II,  a  California   limited
partnership  (the  "Partnership"),  was  formed on June 28,  1984,  to invest in
capital  equipment of various types and to lease such equipment to third parties
on either a long-term or short-term  basis, and to provide financing to emerging
growth  companies  and cable  television  system  operators.  The  Partnership's
minimum  investment  requirements  were met November 24, 1986. The Partnership's
termination date is December 31, 1997.

        On  September  15,  1994,  the  Partnership,   along  with  three  other
affiliated  partnerships  (collectively  "the  Partnerships"),  entered  into  a
settlement  agreement  with  a  borrower  to  transfer  ownership  of all of the
outstanding stock in a cable television system company to a corporation owned by
the  partnerships  in full  satisfaction  of a defaulted note  receivable to the
partnerships.  As a result of this settlement agreement,  Concept Cablevision of
South  Carolina,  Inc.  transferred  100% of the  outstanding  stock to  Phoenix
Concept Cablevision, Inc., a majority owned (58%) subsidiary of the Partnership.
The net carrying value of the defaulted note, including other capitalized costs,
to the  Partnership at the settlement  date was  approximately  $769,000 and was
carried over (from  in-substance  foreclosed  cable systems) to the basis in the
cable system.  Phoenix  Concept  Cablevision,  Inc. (the  Subsidiary) was formed
under the laws of Nevada on December 22, 1992 (hereinafter,  the Partnership and
the Subsidiary are collectively  referred to as the  Consolidated  Partnership).
The acquisition of Concept  Cablevision of South Carolina Inc. by the Subsidiary
through  foreclosure was accounted for using the "purchase method" of accounting
in which the transfer  price was allocated in accordance  with the relative fair
market value of the assets acquired and liabilities assumed.

        For financial reporting purposes,  Partnership income shall be allocated
as follows:  (a) first,  to the General  Partner until the cumulative  income so
allocated is equal to the cumulative  distributions to the General Partner,  (b)
second, before redemption fees, 1% to the General Partner and 99% to the Limited
Partners  until the  cumulative  income so allocated is equal to any  cumulative
Partnership  loss  and  syndication  expenses  for the  current  and  all  prior
accounting  periods,  and (c) the  balance,  if any,  to the Unit  Holders.  All
Partnership losses shall be allocated, before redemption fees, 1% to the General
Partner and 99% to the Unit Holders.

        The General Partner is entitled to receive 5% of all cash  distributions
until the Limited  Partners have recovered their initial  capital  contributions
plus a cumulative return of 12% per annum. Thereafter,  the General Partner will
receive 15% of all cash  distributions.  In the event the General  Partner has a
deficit balance in its capital  account at the time of partnership  liquidation,
it will be required to contribute the amount of such deficit to the Partnership.
During the year ended December 31, 1992, the General  Partner elected to make an
early contribution of $1,404,000,  and the $189,000 in accrued  distributions to
the General Partner at December 31, 1991 was reversed. In addition,  the General
Partner  did not draw its share of the 1994,  1993 and 1992 cash  available  for
distribution.  As  compensation  for management  services,  the General  Partner
receives a fee payable quarterly, in an amount equal to 3.5%, subject to certain
limitations, of the Partnership's gross revenues for the quarter from which such
payment is being made,  which revenues  shall  include,  but are not limited to,
rental  receipts,  maintenance  fees,  proceeds  from the sale of equipment  and
interest income.

        Phoenix  Cable  Management  Inc.  (PCMI),  an  affiliate  of the General
Partner,  provides  day  to day  management  services  in  connection  with  the
operation of the  Subsidiary.  The Subsidiary will pay a management fee equal to
four and  one-half  percent of the  System's  monthly  gross  revenue  for these
services.  Revenues  subject to a management fee at the Subsidiary level are not
subject to management fees at the Partnership level.

        The General  Partner  will be  compensated  for  services  performed  in
connection  with the  analysis  of  assets  available  to the  Partnership,  the
selection  of such  assets  and the  acquisition  thereof,  including  obtaining
lessees for the equipment and negotiating and concluding master lease agreements
with certain lessees. As compensation for such acquisition services, the General
Partner will receive a fee equal to 4%, subject to certain  limitations,  of (a)
the purchase price of equipment acquired by the Partnership, or equipment leased
to  customers  by  manufacturers,  the  financing  for which is  provided by the
Partnership,  or (b) financing  provided to businesses such as cable  operators,
emerging growth companies, or security monitoring system companies, payable upon
such  acquisition  or  financing,  as the  case  may be.  Acquisition  fees  are
amortized over the life of the assets principally on a straight-line basis.
<PAGE>


                                                                   Page 16 of 31


        Phoenix  Securities,  Inc.,  an  affiliate of the General  Partner,  has
contracted  with or  employs  certain  persons  who have  performed  wholesaling
activities in connection with the offering of the units through broker-dealers.

        Schedule  of  compensation  paid and  distributions  made to the General
Partner and affiliate for the years ended December 31,

                                   1995          1994          1993
                                   ----          ----          ----
                                        (Amounts in Thousands)
        Management fees            $125          $161          $230
        Acquisition fees              1             4             8
                                   ----          ----          ----

                                   $126          $165          $238
                                   ====          ====          ====


Note 2.  Summary of Significant Accounting Policies.

       Principles  of  Consolidation.   The  consolidated  financial  statements
include  all  of the  accounts  of  the  Partnership,  and  its  majority  owned
subsidiary,  Phoenix Concept Cablevision Inc., a Nevada  corporation,  since the
date of acquisition,  September 15, 1994. The Partnership owns approximately 58%
of the outstanding  shares of Phoenix Concept  Cablevision  Inc. Phoenix Concept
Cablevision Inc. owns 100% of the outstanding  shares of Concept  Cablevision of
South  Carolina,  Inc., a Delaware  corporation.  All  significant  intercompany
accounts and transactions have been eliminated in the consolidation.

       Leasing Operations.  The Partnership's leasing operations consist of both
financing and operating  leases.  The financing  method of accounting for leases
records as  unearned  income at the  inception  of the lease,  the excess of net
rentals  receivable  and estimated  residual value at the end of the lease term,
over the cost of equipment leased. Unearned income is credited to income monthly
over the term of the lease on a declining basis to provide an approximate  level
rate of return on the unrecovered  cost of the investment.  Initial direct costs
of  consummating  new  leases  are  capitalized  and  included  in the  cost  of
equipment.

         Under the  operating  method  of  accounting  for  leases,  the  leased
equipment  is recorded as an asset at cost and  depreciated.  The  Partnership's
leased equipment is depreciated primarily on an accelerated  depreciation method
over the estimated  useful life of six years,  except for equipment leased under
vendor  agreements,  which is  depreciated  on a  straight-line  basis  over the
estimated useful life, ranging up to six years.

         The  Partnership's  policy  is  to  review  periodically  the  expected
economic life of its rental  equipment in order to determine the  probability of
recovering its  undepreciated  cost. Such reviews  address,  among other things,
recent and anticipated  technological  developments affecting computer equipment
and competitive factors within the computer  marketplace.  Although  remarketing
rental  rates are  expected to decline in the future with respect to some of the
Partnership's  rental  equipment,  such rentals are expected to exceed projected
expenses and  depreciation.  Where reviews of the equipment  portfolio  indicate
that rentals plus  anticipated  sales  proceeds will not exceed  expenses in any
future period, the Partnership  revises its depreciation  policy and accelerates
depreciation as appropriate.

         Rental  income  for the  year is  determined  on the  basis  of  rental
payments due for the period under the terms of the lease.  Maintenance,  repairs
and minor renewals of the leased equipment are charged to expense.

       Cable  Television  System  Operations.   The  consolidated  statement  of
operations  includes the operating activity of the Subsidiary for the year ended
December 31, 1995 and for the period from the date of acquisition (September 15,
1994) to December 31, 1994. The Subsidiary owns and operates a cable  television
system located in the state of South Carolina,  which currently  consists of two
headend  locations and 81 miles of plant passing  approximately  3,710 homes and
has  approximately  1,966 cable  subscribers  at December  31,  1995.  The cable
television system serves the communities of Holly Hill, St. George, Reevesville,
Eutawville,   certain  unincorporated  areas  in  Dorchester  County  and  other
communities  in  Orangeburg   County.   The  cable  system  operates  under  six
non-exclusive franchise agreements with each of the stated municipalities. These
cable franchise agreements expire between the years 1996 and 2003.

       Property,   cable  systems  and  equipment  are  depreciated   using  the
straight-line  method over the estimated  service lives ranging from five to ten
years.  Replacements,  renewals and improvements are capitalized and maintenance
and repairs are charged to expense as incurred.

       Costs assigned to intangible assets are amortized using the straight-line
method over estimated lives of eight years.
<PAGE>


                                                                   Page 17 of 31


       Cable  television  services  are billed  monthly in  advance.  Revenue is
deferred and recognized as the services are provided.

       Investments in Joint Ventures.  Minority investments in net assets of the
equipment joint ventures reflect the Consolidated  Partnership's equity basis in
the ventures. Under the equity method of accounting,  the original investment is
recorded at cost and is adjusted  periodically  to  recognize  the  Consolidated
Partnership's   share  of  earnings,   losses,   cash   contributions  and  cash
distributions after the date of acquisition.

       Investment in Marketable  Securities  Available for Sale. The Partnership
has  investments  in stock warrants in public  companies.  The  Partnership  has
classified its investments in stock warrants as available-for-sale in accordance
with FASB  Statement No. 115,  "Accounting  for Certain  Investments in Debt and
Equity  Securities."  Available-for-sale  securities  are  stated at their  fair
market value, with unrealized gains and losses reported as a separate  component
of partners' capital. The stock warrants held by the Partnership were granted by
certain lessees or borrowers as additional compensation for leasing or financing
equipment.  At the date of grant,  such warrants were determined to have no fair
market value and were recorded at their historical cost of $0.

       Notes  Receivable.   Notes  receivable  generally  are  stated  at  their
outstanding unpaid principal balances, which includes accrued interest. Interest
income is accrued on the unpaid principal balance.

       Impaired Notes Receivable.  Generally, notes receivable are classified as
impaired  and the accrual of interest  on such notes are  discontinued  when the
contractual  payment of  principal  or  interest  has become 90 days past due or
management has serious doubts about further  collectibility  of the  contractual
payments,  even  though  the  loan  may  currently  be  performing.  When a note
receivable is classified as impaired,  income  recognition is discontinued.  Any
payments  received  subsequent  to the  placement of the note  receivable  on to
impaired  status  will  generally  be  applied  towards  the  reduction  of  the
outstanding  note  receivable  balance,  which may  include  previously  accrued
interest as well as principal.  Once the principal and accrued  interest balance
has been reduced to zero,  the  remaining  payments  will be applied to interest
income.  Generally,  notes  receivable  are restored to accrual  status when the
obligation is brought current,  has performed in accordance with the contractual
terms for a  reasonable  period of time and the ultimate  collectibility  of the
total contractual principal and interest is no longer in doubt.

       Allowance  for Losses.  An allowance  for losses is  established  through
provisions for losses charged  against  income.  Notes  receivable  deemed to be
uncollectible  are charged  against the  allowance  for losses,  and  subsequent
recoveries, if any, are credited to the allowance.

       Non Cash Investing  Activities.  During the year ended December 31, 1994,
the Partnership  contributed  equipment and other investments received through a
settlement to a joint venture.  The amount of such  contribution was $1,430,000.
The  Partnership  also  foreclosed  upon a cable  television  company in 1994 as
discussed in Note 1 to the consolidated financial statements.

       Financial  Accounting  Pronouncements.   In  March  1995,  the  Financial
Accounting Standards Board issued Statement of Financial Accounting Standard No.
121,  "Accounting  for the  Impairment of Long-Lived  Assets and for  Long-Lived
Assets to be Disposed  of," which  requires that  long-lived  assets and certain
identifiable  intangibles  to be held  and used by an  entity  be  reviewed  for
impairment  whenever  events  or  changes  in  circumstances  indicate  that the
carrying amount of an asset may not be recoverable. In performing the review for
recoverability,  the entity  would  estimate  the future cash flows  expected to
result from the use of the asset and its eventual disposition. If the sum of the
expected future cash flows  (undiscounted  and without interest charges) is less
than the  carrying  amount  of the  asset,  an  impairment  loss is  recognized.
Measurement  of an  impairment  loss  for  long-lived  assets  and  identifiable
intangibles  that an entity  expects to hold and use should be based on the fair
value of the asset.  Statement No. 121 is effective for financial statements for
fiscal years beginning after December 15, 1995. The Partnership  does not expect
the  adoption  of this  statement  to have a  material  impact on its  financial
position and results of operations. The Partnership plans to adopt Statement No.
121 on January 1, 1996.

       On  January  1,  1995,  the  Partnership  adopted  Financial   Accounting
Standards Board Statement No. 114,  "Accounting by Creditors for Impairment of a
Loan," and Statement No. 118,  "Accounting by Creditors for Impairment of a Loan
- Income  Recognition and Disclosures."  Statement No. 114 requires that certain
impaired  loans be measured  based on the present  value of expected  cash flows
discounted at the loan's  effective  interest  rate; or,  alternatively,  at the
loan's  observable  market price or the fair value of the collateral if the loan
is  collateral  dependent.  Prior to 1995,  the  allowance  for  losses on notes
receivable was based  on the undiscounted  cash flows or  the fair value  of the


<PAGE>


                                                                   Page 18 of 31


collateral  dependent loans. The adoption of this statement had no impact on the
overall allowance for credit losses and did not effect the Partnership's  charge
offs or income recognition policies.

       In  accordance   with   Statement  No.  114,  a  loan  is  classified  as
in-substance foreclosure when the Company has taken possession of the collateral
regardless  of  whether  formal   foreclosure   proceedings  take  place.  Notes
receivable  previously  classified as in-substance  foreclosed cable systems but
for which the  Company  had not taken  possession  of the  collateral  have been
reclassified to notes receivable.

       Reclassification. Certain 1994 and 1993 amounts have been reclassified to
conform to the 1995 presentation.

       Cash and Cash Equivalents.  Cash and cash equivalents include deposits at
banks,  investments  in money market funds and other  highly  liquid  short-term
investments  with  original  maturities  of less than 90 days.  The  Partnership
places its cash deposits in temporary cash investments with credit worthy,  high
quality  financial  institutions.  The  concentration  of such cash deposits and
temporary  cash  investments  is not deemed to create a significant  risk to the
Partnership.

       Credit  and   Collateral.   The   Partnership's   activities   have  been
concentrated  in  the  equipment  leasing  and  financing  industry.   A  credit
evaluation  is performed  by the General  Partner for all leases and loans made,
with  the  collateral  requirements  determined  on a  case-by-case  basis.  The
Partnership's  loans are generally  secured by the equipment or assets  financed
and, in some cases,  other collateral of the borrower.  In the event of default,
the  Partnership  has the right to foreclose upon the collateral  used to secure
such loans.

       Use of Estimates.  The preparation of financial  statements in conformity
with  generally  accepted  accounting  principles  requires  management  to make
estimates  and  assumptions  that affect the amounts  reported in the  financial
statements  and  accompanying  notes.  Actual  results  could  differ from those
estimates.

Note 3.  Accounts Receivable.

       Accounts receivable consist of the following at December 31:

                                              1995          1994
                                              ----          ----
                                             (Amounts in Thousands)

       Lease payments                        $ 119         $ 182
       Cable system service                     54            64
       Property taxes                          --             35
       Other                                     4            11
                                             -----         -----
                                               177           292
       Less: allowance for losses on
               accounts receivable             (67)          (83)
                                             -----         -----

            Total                            $ 110         $ 209
                                             =====         =====


Note 4.  Notes Receivable.
<TABLE>
       Notes receivable consist of the following at December 31:
<CAPTION>
                                                                                             1995           1994
                                                                                             ----           ----
                                                                                            (Amounts in Thousands)
       <S>                                                                               <C>             <C>
       Note receivable from a cable television system operator with stated
        interest of 19% per annum, receivable in installments of 108
        months,  collateralized by a security interest in the cable system
        assets. This note has a graduated repayment schedule followed by a
        balloon payment.                                                                 $  1,713        $ 2,365




<PAGE>


                                                                   Page 19 of 31


       Note receivable from a security monitoring company with stated interest
        at 16% per annum, with payments to be taken out of the monthly
        payments received from assigned contracts,  collateralized by all
        assets of the borrower.  At the end of 48 months, the remaining
        balance, if any, is due and payable.                                                    35              42
                                                                                          -------         -------
                                                                                            1,748           2,407

       Less:  allowance for losses on notes receivable                                       (358)           (368)
                                                                                          -------        --------

           Total                                                                         $  1,390         $ 2,039
                                                                                         ========         =======
</TABLE>

       The  Partnership's  note receivable to a cable television system operator
provides a payment rate in an amount that is less than the contractual  interest
rate. The difference between the payment rate and the contractual  interest rate
is added to the principal and therefore  deferred until the maturity date of the
note. Upon maturity of the note, the original principal and deferred interest is
due and payable in full. Although the contractual  interest rates may be higher,
the amount of interest being recognized on the  Partnership's  outstanding notes
receivable to cable  television  system operators is being limited to the amount
of the payments received,  thereby deferring the recognition of a portion of the
deferred interest until the loan is paid off.

       At  December  31,  1995,  the  recorded  investment  in  notes  that  are
considered to be impaired under  Statement 114 was $36,000 for which the related
allowance  for losses is $23,000.  The average  recorded  investment in impaired
loans during the year ended  December 31, 1995 was  approximately  $89,000.  The
Partnership  recognized  interest income of $73,000 on impaired notes during the
year ended December 31, 1995.

       The  Partnership  received a  settlement  on one of its notes  receivable
during the year ended December 31, 1995.  This note  receivable was from a cable
television operator which was impaired.  The Partnership  received $140,000 as a
settlement  for this note  receivable of which  $68,000 was applied  towards the
outstanding  note receivable  balance and the remaining  $72,000 applied towards
interest income. There was an allowance for losses on notes receivable of $7,000
for this note receivable.  Due to the receipt of a settlement which exceeded the
net  carrying  value of the note  receivable,  this  allowance  was reversed and
recognized as income.

       The activity in the allowance for losses on notes  receivable  during the
years ended December 31, is as follows:

                                                  1995           1994
                                                  ----           ----
                                                 (Amounts in Thousands)
       Beginning balance                         $ 368          $ 368
         Provision for (recovery of) losses         (7)           --
         Write downs                                (3)           --
                                                 -----          -----
       Ending balance                            $ 358          $ 368
                                                 =====          =====


Note 5.  Equipment on Operating Leases and Investment in Financing Leases.

       Equipment on lease consists primarily of computer  peripheral  equipment,
computer mainframes and reproduction equipment.

       The  Partnership's  operating  leases  are for  initial  lease  terms  of
approximately 12 to 48 months.  During the remaining terms of existing operating
leases,  the  Partnership  will not  recover all of the  undepreciated  cost and
related expenses of its rental equipment,  and therefore must remarket a portion
of its equipment in future years.

       The  Partnership  has agreements  with some of the  manufacturers  of its
equipment,  whereby such  manufacturers  will  undertake  to remarket  off-lease
equipment on a best-efforts  basis.  This agreement  permits the  Partnership to
assume the remarketing  function directly if certain conditions contained in the
agreements are not met. For their  remarketing  services,  the manufacturers are
paid a percentage of net monthly rentals.

       The Partnership has entered into direct lease  arrangements  with lessees
consisting  of  Fortune  1000  companies  and  other   businesses  in  different
industries  located  throughout  the  United  States.   Generally,   it  is  the
responsibility  of the lessee to provide  maintenance on leased  equipment.  The
General Partner administers the equipment  portfolio of leases  acquired through


<PAGE>


                                                                   Page 20 of 31


the direct  leasing program.   Administration includes the  collection of  rents
from the lessees and remarketing of the equipment.

       The net  investment  in  financing  leases  consists of the  following at
December 31:

                                                     1995          1994
                                                     ----          ----
                                                  (Amounts in Thousands)

       Minimum lease payments to be received        $ 159         $ 507
       Estimated residual value of leased
        equipment (unguaranteed)                       95            95
       Less:   unearned income                         (6)          (38)
                                                    -----         -----

       Net investment in financing leases           $ 248         $ 564
                                                    =====         =====

       Minimum rentals to be received on noncancellable  operating and financing
leases for the years ended December 31 are as follows:

                                                   Operating      Financing
                                                    (Amounts in Thousands)

       1996 ......................................   $264          $159
       1997 ......................................     56           --
       1998 ......................................     22           --
                                                     ----          ----

       Total                                         $342          $159
                                                     ====          ====

       The  Partnership  receives  contingent  monthly  rental  payments  on its
reproduction  equipment  that  is not  included  in the  minimum  rentals  to be
received.  The contingent  monthly  rentals  consist of a monthly rental payment
that is based upon actual  machine usage.  The monthly usage charge  included in
income  for the years  ended  December  31,  1995,  1994 and 1993 was  $196,000,
$376,000 and $978,000, respectively.

       The net book value of  equipment  held for lease at December 31, 1995 and
1994 amounted to $0 and $36,000, respectively.


Note 6.  Cable Systems, Property and Equipment.

       The  cost of  cable  systems,  property  and  equipment  and the  related
accumulated depreciation consist of the following at December 31:

                                                     1995          1994
                                                     ----          ----
                                                   (Amounts in Thousands)

       Distribution systems                       $   960       $   933
       Headend equipment                              338           330
       Building                                       270           251
       Land                                            21            21
       Automobiles                                     48            19
                                                  -------       -------
                                                    1,637         1,554  
       Less:  accumulated depreciation               (640)         (469)
                                                  -------       -------

       Net property, cable systems and equipment  $   997       $ 1,085
                                                  =======       =======

       Depreciation expense totaled  approximately  $172,000 and $43,000 for the
year ended  December  31,  1995 and for the period  from  September  15, 1994 to
December 31, 1994, respectively.




<PAGE>


                                                                   Page 21 of 31


Note 7.  Investment in Joint Ventures.

Equipment Joint Ventures.

       The  Partnership  owns a  limited  or  general  partnership  interest  in
equipment joint ventures.  These  investments are accounted for using the equity
method of accounting.  The other partners of the ventures are entities organized
and managed by the General Partner.

       The  purpose of the joint  ventures  is the  acquisition  and  leasing of
various types of equipment. During the term of the Partnership,  Phoenix Leasing
Cash  Distribution  Fund II has  participated  in the following  equipment joint
ventures: 
                                                            Weighted
         Joint Venture                                Percentage Interest
         -------------                                -------------------

         Phoenix Leasing Joint Venture 1990-1                 13.23%
         Phoenix Joint Venture 1994-1                         31.25
<TABLE>
       An analysis of the  Partnership's  investment in equipment joint ventures
is as follows:
<CAPTION>
                             Net Investment                          Equity in                            Net Investment
                               at Beginning                          Earnings                                 at End
Date                            of Period       Contributions        (Losses)       Distributions           of Period
----                         --------------     -------------        ---------      -------------         --------------
                                                            (Amounts in Thousands)
<S>                             <C>               <C>                 <C>               <C>                  <C>
Year Ended
 December 31, 1993              $    475          $      0            $  (100)          $   356              $      19
                                =======           ========            =======           =======              =========

Year Ended
 December 31, 1994              $     19          $  1,463            $     6           $     0              $   1,488
                                ========          ========            =======           =======              =========

Year Ended
 December 31, 1995              $  1,488          $      0            $   342           $   835              $     995
                                ========          ========            =======           =======              =========
</TABLE>
       The aggregate  combined  financial  information  of the  equipment  joint
ventures as of December 31 and for the years then ended is presented as follows:

                             COMBINED BALANCE SHEETS

                                     ASSETS

                                                                December 31,
                                                            1995            1994
                                                            ----            ----
                                                          (Amounts in Thousands)

Cash and cash equivalents                                 $  532          $  122
Accounts receivable                                        1,773           2,155
Operating lease equipment                                  1,021           2,527
Other assets                                                 690             890
                                                          ------          ------
     Total Assets                                         $4,016          $5,694
                                                          ======          ======

                        LIABILITIES AND PARTNERS' CAPITAL

Accounts payable                                          $  918          $  904
Partners' capital                                          3,098           4,790
                                                          ------          ------

     Total Liabilities and Partners' Capital              $4,016          $5,694
                                                          ======          ======



<PAGE>


                                                                   Page 22 of 31


                        COMBINED STATEMENTS OF OPERATIONS

                                     INCOME

                                                For the Years Ended December 31,
                                                  1995        1994         1993
                                                  ----        ----         ----
                                                      (Amounts in Thousands)

Rental income                                   $3,595     $ 2,583      $ 3,791
Gain on sale of equipment                        1,637       1,096        1,177
Other income                                       716          38            8
                                                ------     -------      -------

     Total Income                                5,948       3,717        4,976
                                                ------     -------      -------


                                    EXPENSES

Depreciation                                     1,186       1,248        1,677
Lease related operating expenses                 2,832       2,378        3,688
Management fee to the General Partner              286         197          291
Other expenses                                     268          61           54
                                                ------     -------      -------

     Total Expenses                              4,572       3,884        5,710
                                                ------     -------      -------

     Net Income (Loss)                          $1,376     $  (167)     $  (734)
                                                ======     =======      =======

       As of December 31, 1995 and 1994, the  Partnership's pro rata interest in
the equipment joint ventures' net book value of off-lease  equipment was $32,000
and $13,000, respectively.

       The General  Partner earns a management fee of 3.5% of the  Partnership's
respective interest in the gross receipts of the joint venture. Revenues subject
to a management  fee at the joint  venture  level are not subject to  management
fees at the Partnership level.


Note 8.  Accounts Payable and Accrued Expenses.

       Accounts  payable  and  accrued  expenses  consist  of the  following  at
December 31:

                                                      1995          1994
                                                      ----          ----
                                                    (Amounts in Thousands)

       Equipment lease operations                     $237          $383
       Sales and property taxes                        124           365
       General Partner and affiliates                   47            43
       Other                                           176           194
                                                      ----          ----

           Total                                      $584          $985
                                                      ====          ====


Note 9.  Settlement.

       On July 1, 1991, Phoenix Leasing Incorporated,  as General Partner to the
Partnership  and  sixteen  other  affiliated  partnerships,  filed  suit  in the
Superior  Court  for the  County  of  Marin,  Case  No.  150016,  against  Xerox
Corporation,  a  corporation  with which the General  Partner  had entered  into
contractual   agreements  for  the  acquisition  and  administration  of  leased
equipment. The lawsuit was settled out of court effective as of October 28, 1994
pursuant to the terms of a Confidential Settlement Agreement and Mutual Release.
The settlement  agreement  generally  provides for  compensation  payable to the
Partnership  and its  affiliates in cash and kind,  including the  assignment by
Xerox of certain goods and services. The agreement further provides for the sale
by Xerox to the  Partnership  and its affiliates of equipment  subject to lease.
The suit that was filed in the Superior Court for the County of Marin,  Case No.
150016, has been dismissed with prejudice on the merits.



<PAGE>


                                                                   Page 23 of 31


       The  Partnership's pro rata share of the Xerox settlement was $1,180,000,
which consists of cash of $469,000, and assigned monthly rentals and credits for
goods and services valued at $711,000.  In addition,  the Partnership  purchased
additional  leased equipment at an aggregate cost of $718,000.  The Partnership,
along with sixteen other affiliated partnerships managed by the General Partner,
contributed  its share of the assigned  monthly  rentals,  credits for goods and
services and purchased  equipment  leases to Phoenix Joint  Venture  1994-1,  in
exchange for an interest in the joint venture.


Note 10.  Income Taxes.

       Federal and state income tax regulations provide that taxes on the income
or loss of the  Partnership  are reportable by the partners in their  individual
income tax returns.  Accordingly,  no provision  for such taxes has been made in
the accompanying financial statements.

       The net differences between the tax basis and the reported amounts of the
Partnership's assets and liabilities is as follows at December 31:

                                Reported Amounts    Tax Basis     Net Difference
                                ----------------    ---------     --------------
                                               (Amounts in Thousands)
1995

         Assets                      $5,404           $6,033           $(629)
         Liabilities                    380              343              37

1994

         Assets                      $5,561           $6,120           $(559)
         Liabilities                    777              773               4


       The  Subsidiary  is a  corporation  subject  to  state  and  federal  tax
regulations.  The  Subsidiary  reports to the taxing  authority  on the  accrual
basis.  When  income and  expenses  are  recognized  in  different  periods  for
financial  reporting  purposes than for income tax purposes,  deferred taxes are
provided for such differences using the liability method.

       For the years ended  December 31, the  Subsidiary's  income tax provision
includes the following components:

                                                           1995         1994
                                                           ----         ----
                                                          (Amounts in Thousands)

       Current tax expense                                 $ 11         $ 19
       Deferred tax benefit                                  28           (8)
                                                           ----         ----
         Income tax provision, net                         $ 39         $ 11
                                                           ====         ====

       The income tax provision differed from the statutory federal rate because
of the following:

                                                           1995         1994
                                                           ----         ----
                                                         (Amounts in Thousands)

       Federal income tax benefit, based on statutory
        federal and state income tax rate of 37.3%          $19          $11
       Depreciation and amortization                          9            7
       Bad debt expense                                      --            1
       Prior year tax payments                               11           --
                                                            ---          ---
         Total income tax provision                         $39          $19
                                                            ===          ===


<PAGE>


                                                                   Page 24 of 31


       The  Subsidiary's net deferred tax asset as of December 31, resulted from
the following temporary differences:

                                                            1995        1994
                                                            ----        ----
                                                         (Amounts in Thousands)

       Depreciation and amortization                        $105        $141
       Bad debt expense                                        3           1
       Net operating loss carryforward                        10         --
                                                            ----        ----
         Total                                              $118        $142
                                                            ====        ====

       As of December 31, 1995 and 1994,  the  Subsidiary's  net operating  loss
carryforward  of  $26,300  and $0,  respectively,  for  federal  and  state  tax
reporting purposes expires December 31, 2010. The Partnership has not provided a
valuation  allowance for the deferred tax asset as of December 31, 1995 based on
the General  Partner's  evaluation of the  likelihood  that such benefit will be
ultimately realized.


Note 11.  Related Entities.

       The General  Partner and its affiliates  serve in the capacity of general
partner in other partnerships, all of which are engaged in the equipment leasing
and financing business.


Note 12.  Reimbursed Costs to the General Partner.

       The General  Partner incurs certain  administrative  costs,  such as data
processing,   investor   and  lessee   communications,   lease   administration,
accounting,  equipment  storage  and  equipment  remarketing,  for  which  it is
reimbursed by the  Partnership.  These expenses  incurred by the General Partner
are to be  reimbursed at the lower of the actual costs or an amount equal to 90%
of the fair market value for such services.

       The reimbursed administrative costs to the General Partner were $162,000,
$147,000  and $139,000  for the years ended  December  31, 1995,  1994 and 1993,
respectively.  The equipment  storage,  remarketing  and data  processing  costs
reimbursed to the General Partner during the years ended December 31, 1995, 1994
and 1993 were $13,000, $32,000 and $95,000, respectively.

       In  addition,  the  General  Partner  receives  a  management  fee and an
acquisition fee (see Note 1).


Note 13.  Net Income and Distributions per Limited Partnership Unit.

       Net income and distributions  per limited  partnership unit were based on
the Limited  Partners' share of consolidated net income and  distributions,  and
the weighted average number of units  outstanding of 379,583 for the years ended
December 31, 1995,  1994 and 1993.  For the purposes of allocating  consolidated
income and  distributions to each individual  Limited  Partner,  the Partnership
allocates  consolidated net income and distributions  based upon each respective
Limited Partner's ending capital account balance.


Note 14.  Subsequent Events.

       In January 1996, cash  distributions of $239,000 were made to the Limited
Partners.


Note 15.  Business Segments.

       The  Partnership  currently  operates  in  two  business  segments:   the
equipment  leasing  and  financing  industry  and the  cable  TV  industry.  The
operations in the cable TV industry are for the year ended December 31, 1995 and
the period from the date of  acquisition  (September  15,  1994) to December 31,
1994.  Information about the Partnership's  operations in these two segments are
as follows:



<PAGE>


                                                                   Page 25 of 31


                                                 1995       1994       1993
                                                 ----       ----       ----
                                                   (Amounts in Thousands)

  Total Revenues
         Equipment leasing and financing       $2,274     $4,896     $5,613
         Cable TV operations                      594        199          0
                                               ------     ------     ------
              Total                            $2,868     $5,095     $5,613
                                               ======     ======     ======

  Net Income
         Equipment leasing and financing       $1,160     $2,918     $1,570
         Cable TV operations                        4          7          0
                                               ------     ------     ------
              Total                            $1,164     $2,925     $1,570
                                               ======     ======     ======

  Identifiable Assets
         Equipment leasing and financing       $4,658     $4,774     $6,922
         Cable TV operations                    1,492      1,564          0
                                               ------     ------     ------
              Total                            $6,150     $6,338     $6,922
                                               ======     ======     ======

  Depreciation and Amortization Expense
         Equipment leasing and financing       $  288     $  424     $2,010
         Cable TV operations                      200         50          0
                                               ------     ------     ------
              Total                            $  488     $  474     $2,010
                                               ======     ======     ======

  Capital Expenditures
         Equipment leasing and financing       $   32     $  813     $  192
         Cable TV operations                       86        128          0
                                               ------     ------     ------
              Total                            $  118     $  941     $  192
                                               ======     ======     ======


Note 16.  Fair Value of Financial Instruments.

       During  the  year  ended  December  31,  1995,  the  Partnership  adopted
Statement of Financial  Accounting  Standard  No. 107,  "Disclosures  about Fair
Value of Financial  Instruments," which requires disclosure of the fair value of
financial  instruments  for which it is practicable to estimate fair value.  The
following  methods and assumptions  were used to estimate the fair value of each
class of financial instrument which it is practicable to estimate that value.

Cash and Cash Equivalents
The carrying amount of cash and cash equivalents approximates fair value because
of the short maturity of these instruments.

Notes Receivable
The fair  value of notes  receivable  is  estimated  based on the  lesser of the
discounted  expected  future cash flows using the current rates at which similar
loans would be made to borrowers with similar credit  ratings,  or the estimated
fair value of the underlying collateral.

Marketable Securities
The fair values of investments in marketable  securities are estimated  based on
quoted market prices.

The estimated fair values of the Partnership's financial instruments at December
31, 1995 are as follows:

                                                      Carrying
                                                       Amount      Fair Value
                                                      --------     ----------
                                                       (Amounts in Thousands)
      Assets
          Cash and cash equivalents                    $1,951        $1,951
          Marketable securities                            26            26
          Notes receivable                              1,390         2,786



<PAGE>


                                                                   Page 26 of 31



Item 9.  Disagreements on Accounting and Financial Disclosure Matters.

       None.


                                    PART III

Item 10.  Directors and Executive Officers of the Registrant.

       The registrant is a limited partnership and, therefore,  has no executive
officers or directors.  The general partner of the registrant is Phoenix Leasing
Incorporated,  a California corporation. The directors and executive officers of
Phoenix Leasing Incorporated (PLI) are as follows:

       GUS  CONSTANTIN,  age 58, is  President,  Chief  Executive  Officer and a
Director of PLI. Mr.  Constantin  received a B.S. degree in Engineering from the
University of Michigan and a Master's Degree in Management Science from Columbia
University.  From 1969 to 1972,  he served as Director,  Computer and  Technical
Equipment of DCL Incorporated  (formerly Diebold Computer Leasing Incorporated),
a  corporation  formerly  listed on the  American  Stock  Exchange,  and as Vice
President  and  General  Manager  of DCL  Capital  Corporation,  a  wholly-owned
subsidiary of DCL Incorporated. Mr. Constantin was actively engaged in marketing
manufacturer  leasing programs to computer and medical  equipment  manufacturers
and in directing DCL Incorporated's IBM System/370 marketing  activities.  Prior
to  1969,  Mr.  Constantin  was  employed  by IBM as a data  processing  systems
engineer for four years. Mr. Constantin is an individual general partner in four
active partnerships and is an NASD registered  principal.  Mr. Constantin is the
founder of PLI and the  beneficial  owner of all of the common  stock of Phoenix
American Incorporated.

       PARITOSH K. CHOKSI,  age 42, is Senior Vice  President,  Chief  Financial
Officer and Treasurer of PLI. He has been  associated  with PLI since 1977.  Mr.
Choksi  oversees  the  finance,  accounting,  information  services  and systems
development  departments of the General  Partner and its Affiliates and oversees
the structuring,  planning and monitoring of the  partnerships  sponsored by the
General  Partner  and its  Affiliates.  Mr.  Choksi  graduated  from the  Indian
Institute of Technology, Bombay, India with a degree in Engineering. He holds an
M.B.A. degree from the University of California, Berkeley.

       GARY W.  MARTINEZ,  age 45, is Senior Vice  President of PLI. He has been
associated  with PLI since  1976.  He manages the Asset  Management  Department,
which is  responsible  for lease and loan  portfolio  management.  This includes
credit  analysis,   contract  terms,   documentation  and  funding;   remittance
application,  change processing and maintenance of customer  accounts;  customer
service, invoicing,  collection,  settlements and litigation;  negotiating lease
renewals,  extensions,  sales and buyouts; and management information reporting.
From 1973 to 1976, Mr.  Martinez was a Loan Officer with Crocker  National Bank,
San  Francisco.  Prior to 1973,  he was an Area Manager with  Pennsylvania  Life
Insurance  Company.  Mr. Martinez is a graduate of California State  University,
Chico.

       BRYANT J. TONG, age 41, is Senior Vice President, Financial Operations of
PLI.  He has been with PLI since  1982.  Mr. Tong is  responsible  for  investor
services and overall company  financial  operations.  He is also responsible for
the technical and  administrative  operations of the cash management,  corporate
accounting,  partnership accounting,  accounting systems,  internal controls and
tax  departments,  in addition to Securities  and Exchange  Commission and other
regulatory  agency  reporting.  Prior to his association  with PLI, Mr. Tong was
Controller-Partnership  Accounting with the Robert A. McNeil Corporation for two
years and was an auditor with Ernst & Whinney  (succeeded by Ernst & Young) from
1977 through 1980.  Mr. Tong holds a B.S. in Accounting  from the  University of
California, Berkeley, and is a Certified Public Accountant.

       CYNTHIA E. PARKS, age 40, is Vice President,  General Counsel,  Assistant
Secretary and a Director of PLI. Prior to joining PLI in 1984, she was with GATX
Leasing  Corporation,  and had  previously  been  Corporate  Counsel  for  Stone
Financial  Companies,  and an Assistant  Vice  President of the Bank of America,
Bank Amerilease  Group. She has a bachelor's degree from Santa Clara University,
and earned her J.D. from the University of San Francisco School of Law.

       HOWARD SOLOVEI, age 34, is Vice President,  Finance,  Assistant Treasurer
and a Director of PLI. He has been associated with PLI since 1984. Mr. Solovei's
principal  activities  are in the areas of arranging  and managing the company's
banking relationships for its various corporations, partnerships and securitized


<PAGE>


                                                                   Page 27 of 31


assets pools. Mr. Solovei is also  involved in corporate  financial planning and
various data processing-related  projects. Mr. Solovei  graduated with a B.S. in
Business from the University of California at Berkeley in 1984.

       Neither the  General  Partner  nor any  Executive  Officer of the General
Partner has any family relationship with the others.

       Phoenix Leasing Incorporated or its affiliates and the executive officers
of the General Partner serve in a similar  capacity to the following  affiliated
limited partnerships:

               Phoenix Leasing American Business Fund, L.P.
               Phoenix Leasing Cash Distribution Fund V, L.P.
               Phoenix Income Fund, L.P.  
               Phoenix High Tech/High Yield Fund
               Phoenix Leasing Cash Distribution Fund IV 
               Phoenix Leasing Cash Distribution Fund III  
               Phoenix Leasing Capital Assurance Fund
               Phoenix Leasing Income Fund VII 
               Phoenix Leasing Income Fund VI
               Phoenix Leasing Growth Fund 1982 
               Phoenix Leasing Income Fund 1981 and 
               Phoenix Leasing Income Fund 1977


Item 11.  Executive Compensation.
<TABLE>
       Set forth is the information  relating to all direct remuneration paid or
accrued by the  Registrant  during the last year to the General  Partner and its
affiliate.
<CAPTION>
         (A)                         (B)                                (C)                                     (D)

                                                                                                         Aggregate of
  Name of                      Capacities                        Cash and cash-                           contingent
 Individual or                  in which                        equivalent forms                           forms of
persons in group                served                          of remuneration                          remuneration
----------------               -----------      ---------------------------------------------------      ------------
                                                       (C1)                          (C2)
                                                                                  Securities or
                                                Salaries, fees,                 property insurance
                                                directors' fees,                benefits or reim-
                                                commissions and                 bursement, personal
                                                   bonuses                           benefits
                                                ----------------                -------------------
                                                               (Amounts in Thousands)
<S>                          <C>                    <C>                                <C>                     <C>
Phoenix Leasing
 Incorporated                General Partner        $ 100(1)                           $  0                    $ 0

Phoenix Cable
 Management Inc.             Manager                   27(2)                              0                      0
                                                    -----                              ----                    ---

                                                    $ 127                              $  0                    $ 0
                                                    =====                              ====                    ===

(1) consists of management and acquisition fees.
(2) consists of management fees.
</TABLE>

Item 12.  Security Ownership of Certain Beneficial Owners and Management.

         (a)  No person  owns of record,  or is known by the  Registrant  to own
              beneficially,  more  than  five  percent  of any  class of  voting
              securities of the Registrant.



<PAGE>


                                                                   Page 28 of 31

<TABLE>
         (b)  The General Partner of the Registrant  owns the equity  securities
              of the Registrant set forth in the following table:
<CAPTION>
                (1)                                         (2)                                           (3)
         Title of Class                         Amount Beneficially Owned                          Percent of Class
         --------------                         -------------------------                          ----------------
     <S>                              <C>                                                                <C>
     General Partner                  Represents a 5% interest in the Registrant's profits               100%
     Interest                         and distributions, until the Limited Partners have
                                      recovered their capital contributions plus
                                      a cumulative return of 12% per annum,
                                      compounded  quarterly,  on the unrecovered
                                      portion thereof.  Thereafter,  the General
                                      Partner  will  receive 15% interest in the
                                      Registrant's profits and distributions.


     Limited Partner
     Interest                         336 units                                                          .09%

</TABLE>
Item 13.  Certain Relationships and Related Transactions.

       None.


                                     PART IV

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

                                                                        Page No.
                                                                        --------
(a)      1.   Financial Statements:

              Consolidated Balance Sheets as of December 31, 1995 
               and 1994 ................................................      11
              Consolidated Statements of Operations for the Years 
               Ended December 31, 1995, 1994 and 1993 ..................      12
              Consolidated Statements of Partners' Capital for the 
               Years Ended December 31, 1995, 1994 and 1993 ............      13
              Consolidated Statements of Cash Flows for the Years 
               ended December 31, 1995, 1994 and 1993 ..................      14
              Notes to Consolidated Financial Statements ...............   15-25

         2.   Financial Statement Schedule:

              Schedule II - Valuation and Qualifying Accounts and 
               Reserves ................................................      31

         All other schedules are omitted because they are not applicable, or not
required,  or because the  required  information  is  included in the  financial
statements or notes thereto.

(b)      Reports on Form 8-K:

         No reports on Form 8-K were filed for the year ended December 31, 1995.




<PAGE>


                                                                   Page 29 of 31


(c)      Exhibits

         21.  Additional Exhibits

                a)    Listing of all subsidiaries of the Registrant:

                      Phoenix Concept  Cablevision,  Inc., a Nevada  corporation
                      and majority (58%) owned subsidiary.

                b)    Financial Statements for Significant Subsidiaries:

                      Phoenix Joint Venture 1994-1                     E21 1-10

         27.  Financial Data Schedule



<PAGE>


                                                                   Page 30 of 31

                                   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.

                                       PHOENIX LEASING CASH DISTRIBUTION FUND II
                                                  (Registrant)

                                       BY:    PHOENIX LEASING INCORPORATED,
                                              A CALIFORNIA CORPORATION
                                              GENERAL PARTNER


         Date:  March 28, 1996         By:    /S/  GUS CONSTANTIN
                --------------                -------------------------
                                              Gus Constantin, President

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
           Signature                                  Title                                          Date
           ---------                                  -----                                          ----
<S>                                            <C>                                             <C>

/S/ GUS CONSTANTIN                                                                             March 28, 1996
-----------------------                        President, Chief Executive Officer and a        --------------
(Gus Constantin)                               Director of Phoenix Leasing Incorporated
                                               General Partner


/S/  PARITOSH K. CHOKSI                                                                        March 28, 1996
-----------------------                        Chief Financial Officer,                        --------------
(Paritosh K. Choksi)                           Senior Vice President
                                               and Treasurer of
                                               Phoenix Leasing Incorporated
                                               General Partner


/S/  BRYANT J. TONG                                                                            March 28, 1996
----------------------                         Senior Vice President, Financial                --------------
(Bryant J. Tong)                               Operations of
                                               (Principal Accounting Officer)
                                               Phoenix Leasing Incorporated
                                               General Partner


/S/  GARY W. MARTINEZ                                                                          March 28, 1996
---------------------                          Senior Vice President of                        --------------
(Gary W. Martinez)                             Phoenix Leasing Incorporated
                                               General Partner


/S/ HOWARD SOLOVEI                                                                             March 28, 1996
----------------------                         Vice President, Finance                         --------------
(Howard Solovei)                               Assistant Treasurer and a
                                               Director of Phoenix Leasing Incorporated
                                               General Partner


/S/  MICHAEL K. ULYATT                         Partnership Controller                          March 28, 1996
----------------------                         Phoenix Leasing Incorporated                    --------------
(Michael K. Ulyatt)                            General Partner

</TABLE>

<PAGE>

<TABLE>
                                                                                                                Page 31 of 31

                                    PHOENIX LEASING CASH DISTRIBUTION FUND II AND SUBSIDIARY

                                                             SCHEDULE II
                                                      (Amounts in Thousands)

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

<CAPTION>
              COLUMN A                     COLUMN B             COLUMN C            COLUMN D          COLUMN E         COLUMN F
           Classification                 Balance at           Charged to          Charged to        Deductions       Balance at
                                         Beginning of            Expense             Revenue                            End of
                                            Period                                                                      Period
------------------------------------- -------------------  -------------------  ----------------- --------------  ------------------

<S>                                       <C>               <C>                  <C>              <C>                 <C>
Year ended December 31, 1993
   Allowance for losses on accounts
     receivable                           $    468          $     0              $   0            $     15            $    453
   Allowance for early termination
     of financing leases                         4                0                  4                   0                   0
   Allowance for losses on notes
     receivable                                253              115                  0                   0                 368
                                          --------          -------              -----            --------            --------

     Totals                               $    725          $   115              $   4            $     15            $    821
                                          ========          =======              =====            ========            ========

Year ended December 31, 1994
   Allowance for losses on accounts
     receivable                           $    453          $     2              $ 334            $     38            $     83
   Allowance for losses on notes
     receivable                                368                0                  0                   0                 368
                                          --------          -------              -----            --------            --------

     Totals                               $    821          $     2              $ 334            $     38            $    451
                                          ========          =======              =====            ========            ========

Year ended December 31, 1995
   Allowance for losses on accounts
     receivable                           $     83          $    17              $   0            $     33            $     67
   Allowance for losses on notes
     receivable                                368                0                  7                   3                 358
                                          --------          -------              -----            --------            --------

     Totals                               $    451          $    17              $   7            $     36            $    425
                                          ========          =======              =====            ========            ========
</TABLE>