Use the following to answer the questions below:

In its 2021 annual report to shareholders, the Koch Johnson Chemical Company (KJ) included the following disclosure note excerpts on CONTINGENCIES in its annual report to shareholders:

At December 31, 2021, KJ had recorded liabilities aggregating $66.5 million for anticipated costs related to various environmental matters, primarily the remediation of numerous waste disposal sites and certain properties sold by KJ. These costs include legal and consulting fees, site studies, the design and implementation of remediation plans, post-remediation monitoring and related activities and will be paid over several years. The amount of KJ's ultimate liability in respect of these matters may be affected by several uncertainties, primarily the ultimate cost of required remediation and the extent to which other responsible parties contribute.

At December 31, 2021, KJ had recorded liabilities aggregating $218.7 million for potential product liability and other tort claims, including related legal fees expected to be incurred, presently asserted against KJ. The amount recorded was determined on the basis of an assessment of potential liability using an analysis of available information with respect to pending claims, historical experience, and, where available, current trends.

KJ is a defendant in numerous lawsuits involving at December 31, 2021, approximately 63,000 claimants alleging various asbestos-related personal injuries purported to result from exposure to asbestos in certain products manufactured by KJ in the past or in certain KJ facilities. Typically, these lawsuits have been brought against multiple defendants in state and federal courts. In the past, KJ has disposed of approximately 22,000 cases by defending and obtaining the dismissal thereof or by entering into a settlement. KJ has policies and coverage-in-place agreements with certain of its insurance carriers that cover a substantial portion of estimated indemnity payments and legal fees in respect of the pending claims. At December 31, 2021, KJ has recorded an asset in the amount it expects to collect under the policies and coverage-in-place agreements with certain carriers related to its estimated asbestos liability. KJ has also commenced discussions with certain of its excess coverage insurance carriers to establish arrangements in respect of their policies.

Subject to the uncertainties referred to above, KJ has concluded that in respect of any of the above described liabilities, it is not reasonably possible that it would incur a loss exceeding the amount recognized at December 31, 2021, with respect thereto which would be material relative to the consolidated financial position, results of operations, or liquidity of KJ.

KJ is facing a number of lawsuits and potential costs/expenses. Briefly explain, in your own words, the GAAP requirements for both a) recognition and b) disclosure of these contingencies.

B. For any amounts subject to recognition, please provide the accounts and amounts affected.

The Income Statement excerpt shown below lists two distinct types of impairments. Briefly explain the difference and how each is calculated. Years Ended November 30, 2019 2020 2018 Revenues Passenger ticket Onboard and other $ 3,684 $ 1,910 5,595 14,104 $ 6,721 20,825 13,930 4,950 18,881 Operating costs and Expenses Commissions, transportation and other Onboard and other Payroll and related Fuel Food Ship and other impairments Other operating 1,139 605 1.780 823 413 1.967 1,518 8,245 1,878 2,241 2,096 14,460 (8,865) 2.720 2.101 2.249 1,562 1,083 26 3.167 12.909 2,480 2,160 2,590 638 2,190 1,619 1,066 16 2.971 11.089 2,450 2,017 Selling and administrative Depreciation and amortization Goodwill impairments 17,549 15,556 3,325 Operating Income (Loss) 3,276