Short answers, pulled from the story.
Japanese air forces attacked and sank the USS Panay at 3:54 pm while it was anchored 28 miles upstream from Nanjing. Three bombers dropped eighteen bombs that struck the vessel, followed by fighter strafing that killed two crew members.
Colonel Kingoro Hashimoto deliberately ordered artillery attacks on the sinking ship and other vessels regardless of their nationality. Intelligence indicated attacking planes were under specific orders rather than acting on a mistake of any kind.
The Japanese government paid an indemnity of $2,214,007.36 to the United States on the 22nd of April 1938. This settlement officially closed the Panay incident following a formal apology delivered on Christmas Eve.
Storekeeper First Class Charles Lee Ensminger died during the initial assault and Coxswain Edgar C. Hulsebus succumbed to his wounds later that night. The three Standard Oil tankers also suffered casualties including Captain Carl H. Carlson of Mei An.
Navy cryptographers decrypted traffic indicating attacking planes were under orders and American flags were clearly visible on the vessel. Modern historians believe renegade factions within the Japanese army wanted to force U.S. involvement in active conflict.