Much like an axle, a transmission or T-case should be easy to turn by hand. Grab a yoke or input shaft and turn away. If you feel rough spots while turning the yoke or input shaft, the transmission or T-case may need new bearings. If things turn a little and then clunk, teeth could be pitted or broken. Also, wiggle the yoke or input/output shafts; if they rock back and forth or move around, things are not right. Remember that even if everything feels great and shifts well, the syncros of a transmission could be worn out meaning a rebuild is in order. You may need to pry T-case shifters or tap them with a rubber mallet to get them to shift.