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


                                    FORM 10-Q


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

For the quarterly period ended                     June 30, 1998
                                     -------------------------------------------

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

For the transition period from                          to
                                     ------------------    ---------------------

                         Commission file number 0-18504
                         Commission file number 0-18512

                    PARTICIPATING INCOME PROPERTIES II, L.P.
                                       and
                    FFCA INVESTOR SERVICES CORPORATION 88-C
--------------------------------------------------------------------------------
               (Exact Name of Co-Registrants as Specified in Their
                            Organizational Documents)


             Delaware                                       86-0588505
--------------------------------------------------------------------------------
(Partnership State of Organization)                 (Partnership I.R.S. Employer
                                                       Identification Number)

             Delaware                                       86-0588507
--------------------------------------------------------------------------------
(Corporation State of Incorporation)                (Corporation I.R.S. Employer
                                                       Identification Number)

The Perimeter Center
17207 North Perimeter Drive
Scottsdale, Arizona                                                    85255
--------------------------------------------------------------------------------
(Address of principal executive offices)                             (zip code)


Co-Registrants' telephone number including area code        (602) 585-4500
                                                         -----------------------



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                           Yes  X             No
                               ---               ---
<PAGE>
PART 1 - FINANCIAL INFORMATION

   Item l.  Financial Statements.
   -------  ---------------------


                    PARTICIPATING INCOME PROPERTIES II, L.P.

                                 BALANCE SHEETS
                       JUNE 30, 1998 AND DECEMBER 31, 1997
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                 June 30,      December 31,
                                                                   1998            1997
                                                               ------------    ------------
<S>                                                            <C>             <C>         
                                          ASSETS
                                          ------

CASH AND CASH EQUIVALENTS                                      $  4,009,516    $  3,984,265

RECEIVABLES FROM LESSEES                                            202,300         197,300

DEFERRED COSTS                                                        9,531            --

PROPERTY SUBJECT TO OPERATING LEASES, at cost
         Land                                                    11,709,570      11,709,570
         Buildings                                               54,004,577      54,004,577
         Equipment                                                3,832,921       3,832,921
                                                               ------------    ------------
                                                                 69,547,068      69,547,068
         Less - Accumulated depreciation                         22,023,018      20,814,945
                                                               ------------    ------------

                                                                 47,524,050      48,732,123
                                                               ------------    ------------

                     Total assets                              $ 51,745,397    $ 52,913,688
                                                               ============    ============


                             LIABILITIES AND PARTNERS' CAPITAL
                             ---------------------------------

DISTRIBUTION PAYABLE TO LIMITED PARTNERS                       $  2,188,296    $  2,132,357

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES                             55,850          72,006

DEFERRED INCOME                                                     457,141         594,251
                                                               ------------    ------------

                     Total liabilities                            2,701,287       2,798,614
                                                               ------------    ------------

PARTNERS' CAPITAL (DEFICIT):
      General partners                                             (228,137)       (217,427)
      Limited partners                                           49,272,247      50,332,501
                                                               ------------    ------------

                     Total partners' capital                     49,044,110      50,115,074
                                                               ------------    ------------

                     Total liabilities and partners' capital   $ 51,745,397    $ 52,913,688
                                                               ============    ============
</TABLE>
<PAGE>
                    PARTICIPATING INCOME PROPERTIES II, L.P.

                              STATEMENTS OF INCOME
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1998 AND 1997
                                   (Unaudited)

<TABLE>
<CAPTION>
                                           Three Months   Three Months   Six Months   Six Months
                                               Ended          Ended         Ended        Ended
                                              6/30/98        6/30/97       6/30/98      6/30/97
                                           ------------   ------------   ----------   ----------
<S>                                         <C>            <C>           <C>          <C>       
REVENUES:                                                               
      Rental                                $1,865,905     $1,865,905    $3,731,810   $3,731,810
      Participating rentals                    639,277        618,708     1,204,502    1,150,225
      Interest and other                        44,273         43,061        89,484       98,758
      Gain on sale of equipment                   --             --            --          2,138
                                            ----------     ----------    ----------   ----------
                                             2,549,455      2,527,674     5,025,796    4,982,931
                                            ----------     ----------    ----------   ----------
EXPENSES:                                                               
      General partner fees                     218,570        217,249       429,606      426,350
      Depreciation                             594,840        756,141     1,208,073    1,522,539
      Operating                                 52,345         45,246       115,290      106,458
                                            ----------     ----------    ----------   ----------
                                                                        
                                               865,755      1,018,636     1,752,969    2,055,347
                                            ----------     ----------    ----------   ----------
                                                                        
NET INCOME                                  $1,683,700     $1,509,038    $3,272,827   $2,927,584
                                            ==========     ==========    ==========   ==========
                                                                        
                                                                        
NET INCOME ALLOCATED TO:                                                
      General partners                      $   16,837     $   15,090    $   32,728   $   29,276
      Limited partners                       1,666,863      1,493,948     3,240,099    2,898,308
                                            ----------     ----------    ----------   ----------
                                                                        
                                            $1,683,700     $1,509,038    $3,272,827   $2,927,584
                                            ==========     ==========    ==========   ==========
                                                                        
NET INCOME PER LIMITED                                                  
   PARTNERSHIP UNIT (based on                                           
   82,834 units held by limited partners)   $    20.12     $    18.04    $    39.12   $    34.99
                                            ==========     ==========    ==========   ==========
                                                                       
</TABLE>
<PAGE>
                    PARTICIPATING INCOME PROPERTIES II, L.P.

                    STATEMENT OF CHANGES IN PARTNERS' CAPITAL
                     FOR THE SIX MONTHS ENDED JUNE 30, 1998
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                       Limited Partners
                                   General       ---------------------------
                                   Partners         Number                         Total
                                    Amount         of Units        Amount          Amount
                                 ------------    ------------   ------------    ------------

<S>                              <C>                   <C>      <C>             <C>         
BALANCE, December 31, 1997       $   (217,427)         82,834   $ 50,332,501    $ 50,115,074

      Net income                       32,728            --        3,240,099       3,272,827

      Distribution to partners        (43,438)           --       (4,300,353)     (4,343,791)
                                 ------------    ------------   ------------    ------------

BALANCE, June 30, 1998           $   (228,137)         82,834   $ 49,272,247    $ 49,044,110
                                 ============    ============   ============    ============
</TABLE>
<PAGE>
                    PARTICIPATING INCOME PROPERTIES II, L.P.

                            STATEMENTS OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                1998           1997
                                                            -----------    -----------
<S>                                                         <C>            <C>        
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net income                                             $ 3,272,827    $ 2,927,584
     Adjustments to net income:
        Depreciation                                          1,208,073      1,522,539
        Gain on sale of equipment                                  --           (2,138)
        Change in assets and liabilities:
           Increase in receivables from lessees                  (5,000)       (27,218)
           Increase in deferred costs                            (9,531)          --
           Decrease in payable to general partner                  --          (18,239)
           Decrease in accounts payable
               and accrued expenses                             (16,156)        (5,000)
           Decrease in deferred income                         (137,110)      (137,109)
                                                            -----------    -----------

               Net cash provided by operating activities      4,313,103      4,260,419
                                                            -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Proceeds from sale of property                                --           42,750
                                                            -----------    -----------

CASH FLOWS FOR FINANCING ACTIVITIES:
     Partner distributions declared                          (4,343,791)    (4,310,875)
     Increase in distribution payable to limited partners        55,939         99,559
                                                            -----------    -----------

              Net cash used in financing activities          (4,287,852)    (4,211,316)
                                                            -----------    -----------

NET INCREASE IN CASH AND CASH EQUIVALENTS                        25,251         91,853

CASH AND CASH EQUIVALENTS, beginning of period                3,984,265      3,790,885
                                                            -----------    -----------

CASH AND CASH EQUIVALENTS, end of period                    $ 4,009,516    $ 3,882,738
                                                            ===========    ===========
</TABLE>
<PAGE>
PART I.- FINANCIAL INFORMATION
------------------------------


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


      As of June 30, 1998,  Participating Income Properties II, L.P., a Delaware
      limited partnership,  (the Registrant),  had received $82,834,000 in gross
      proceeds from its offering of Units.  Net funds  available for investment,
      after payment of sales commissions,  organizational  costs and acquisition
      costs, amounted to $71,956,541.  The offering of Units is the Registrant's
      sole source of capital, and since the final closing of limited partnership
      units was held on  December  11,  1989,  the  Registrant  will not receive
      additional  funds from the offering.  The Registrant was fully invested in
      thirteen travel plaza  properties by June 1991 and does not anticipate any
      further capital expenditures.

      On February 2, 1998, the  Registrant  entered into a letter of intent with
      Flying J. Inc. to sell  substantially  all of the Registrant's  assets for
      cash of  approximately  $80  million.  The  sale  is  subject  to  certain
      conditions  specified in the letter of intent,  including the  negotiation
      and execution of definitive sale and financing  agreements with respect to
      the assets of the Registrant  and the approval,  by vote, of a majority of
      the  limited  partner  interests.   In  accordance  with  the  partnership
      agreement,  sale  of  substantially  all  of the  assets  will  result  in
      dissolution  of  the  partnership  and  liquidation  of  the  Registrant's
      remaining assets, net of liabilities.  There can be no assurance as to the
      final  terms of the  proposed  transaction,  that the  conditions  will be
      satisfied  or that  the  proposed  transaction  will be  consummated.  The
      limited  partners  will  receive a proxy  statement  containing a complete
      description of the proposed transaction.

      The Registrant  declared a cash  distribution  to the limited  partners of
      $2,187,885  for the  quarter  ended  June 30,  1998  (the  period)  which,
      combined with the first quarter  distribution  of  $2,112,468,  amounts to
      $4,300,353 year to date. During the period,  all net proceeds not invested
      in real estate were invested in Government  Agency discount notes and bank
      repurchase  agreements  (which are secured by United  States  Treasury and
      Government obligations).

      During the period, the Registrant received base rental revenue pursuant to
      its lease  arrangements  in the amount of  $1,865,905,  unchanged from the
      comparable period of the prior year (year-to-date base rental revenues are
      similarly  unchanged).  Base rental  revenue for the period  includes  the
      recognition of approximately  $69,000 of income  previously  deferred.  In
      addition,  the  Registrant  received or accrued  participating  rentals of
      $639,277  for the  period  representing  an  increase  over  participating
      rentals of $618,708 for the  comparable  period in 1997.  On June 1, 1996,
      CFJ Properties (the  Registrant's  only lessee) curtailed its relationship
      with a large third party billing  company for the trucking  industry.  The
      billing company  requested  changes to its contract that were unacceptable
      to  CFJ   Properties'   management  due  to  the   significant   long-term
      ramifications  of the proposed change on CFJ Properties'  future business.
      This  resulted in reduced  volume and margins,  which  contributed  to low
      participating  rental  revenues  in the  quarter  ended  June 30,  1997 as
      compared to the quarter ended June 30, 1998. Participating rentals for the
      corresponding year-to-date periods were similarly affected. Total expenses
      decreased  by  $152,881  during  the  period  ($302,378  year-to-date)  as
      compared to the prior  periods due to a decrease in  depreciation  expense
      related to the sale of travel plaza equipment in the last twelve months.

      The  decrease in total  assets  reflected  in the  Registrant's  financial
      statements   filed  with  this  report  is  mainly   attributable  to  the
      depreciation allowance, which is deducted for accounting purposes from the
      cost of the assets on the Registrant's books.

      In the opinion of management,  the financial  information included in this
      report reflects all adjustments necessary for fair presentation.  All such
      adjustments are of a normal recurring nature.
<PAGE>
                     FFCA INVESTOR SERVICES CORPORATION 88-C
                     ---------------------------------------


                          BALANCE SHEET - JUNE 30, 1998
                          -----------------------------




                                     ASSETS


Cash                                                                        $100
Investment in Participating Income Properties II, L.P., at cost              100
                                                                            ----

                  Total Assets                                              $200
                                                                            ====

                                    LIABILITY

Payable to Parent                                                           $100
                                                                            ----


                              STOCKHOLDER'S EQUITY


Common Stock; $l par value; 100 shares authorized,
     issued and outstanding                                                  100
                                                                            ----

                  Liability and Stockholder's Equity                        $200
                                                                            ====




Note: FFCA Investor Services Corporation 88-C (88-C) was organized on August 11,
1987 to act as the assignor limited partner in Participating  Income  Properties
II, L.P. (PIP-II).

         The  assignor  limited  partner  is the owner of record of the  limited
partnership units of PIP-II. All rights and powers of 88-C have been assigned to
the holders,  who are the registered and beneficial  owners of the units.  Other
than to serve as assignor  limited  partner,  88-C has no other business purpose
and will not engage in any other activity or incur any debt.
<PAGE>
                                   SIGNATURES
                                   ----------

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrants  have  caused  this  report  to be  signed  on their  behalf  by the
undersigned thereunto duly authorized.

                                  PARTICIPATING INCOME PROPERTIES II, L.P.

                                  By FRANCHISE FINANCE CORPORATION OF AMERICA II
                                  Corporate General Partner



Date: August 3, 1998                      By /s/ John Barravecchia
                                      ------------------------------------------
                                      John Barravecchia, Chief Financial Officer
<PAGE>
                                   SIGNATURES
                                   ----------

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
co-registrant  has  caused  this  report  to be  signed  on  its  behalf  by the
undersigned thereunto duly authorized.

                                   FFCA INVESTOR SERVICES CORPORATION 88-C




Date: August 3, 1998                    By /s/ John Barravecchia
                                   ---------------------------------------------
                                   John Barravecchia, President