Question 2: a) Compensation takes the character of what it replace - Meeks principle Payment for loss thumb would be capital. b) Student may discuss in reference to the business scope to determine that the sale is mere realization to best advantage (Scottish Mining). State Myer principle and clarification from Westfield case - intention to profit must be at the time the asset was acquired. Myer does not apply because the land was acquired to be a capital asset and not for the purpose of profiting from re-sale. Not extensive enough development for the principles from whitfords beach to apply c) Tips common incident/ in connection with service would be assessable under $ 6-5