The employees of Break Fast Pty Ltd ("Break Fast") have the following questions. Each of these are in relation to independent matters from various employees:

1. John: He was running a business on the side (with Break Fast's permission) for 3 years. A loan was taken out 3 years ago for the business. John decided to cease the business at the beginning of the 2015 income year after many years of continued losses. The business was sold for a small consideration. However, the sale proceeds were insufficient to repay the entire loan. Interest continues to accrue on the business loan. He is unsure about the deductibility of the interest on the business loan.

2. Shaun: He made a gain on sale of a painting which was hung in his home office study. The painting cost him $200,000 in 2010 and was sold to his brother for $500,000 during the income year. The market value of the painting was $600,000 at the time of sale. However, Shaun accepted the lower offer because he was in need of the cash quickly.

3. Jane: She transferred a vacant block of land to her husband for nil consideration during the 2015 income year. She purchased the land in 1982 for $20,000 as a speculative investment, hoping to make some quick bucks. A developer offered to buy the land for $2m. She has decided to transfer the land to her husband for no consideration after being advised by her accountant. It is intended that her husband will on-sell the land to the developer for $2m.

4. Jack: Sold his 80-hectare acreage in 8 separate parcels for a total of $1.2m during the 2015 income year. He has lived on that property continuously since 2000 when it was purchased for $700,000. The property has never been used to produce assessable income. Each hectare has the same value.

5. May: Received $1,000 from her university for winning the top prize in her Master of Commerce Auditing subject. She is currently working in the internal audit division of Break Fast.

6. Mike: Incurred $2,000 in feasibility studies in relation to whether there is a market for domestic windmills. He intends to sell the devices over Ebay over the coming months.

REQUIRED:  

Explain the income tax implications of the above transactions for each of the employees involved. Provide section references and case law to support your answer. Support your answer with reference to ATO rulings, case law and legislation.