Build Example (Part 1 of 2)
You decide to use one of your actions to Build. You have 4 Wood and 3 Straw, which means you could afford a Straw Floor, or Wood Walls to go on the Wood Floor you built on an earlier turn. (Notice that although you have enough resources to build a Wood Floor, you may not because you already have a Wood house underway.)
You decide to build the Wood Walls. You pay the 4 Wood back to the Supply, take a Wood Walls section from the Supply, and stack it on top of your Wood Floor.
Since you built a Walls section, you draw one Friend card, and decide whether to keep it or give it to someone else ...
Build Example (Part 2 of 2)
You drew a Friend (Rumplestiltskin) from the deck because you built a Walls section. You already have Goldilocks as a friend and want to keep her, so you pass Rumplestiltskin to another player. That player is forced to discard their existing friend and keep Rumplestiltskin.