For each of the following separate transactions:

1. Sold a building costing $39,500, with $23,800 of accumulated depreciation, for $11,800 cash, resulting in a $3,900 loss.
2. Acquired machinery worth $13,800 by issuing $13,800 in notes payable.
3. Issued 1,380 shares of common stock at par for $2 per share.
4. Note payables with a carrying value of $41,900 were retired for $50,800 cash, resulting in a $8,900 loss.

(a) Prepare the reconstructed journal entry. (b) Identify the effect it has, if any, on the investing section or financing section of the statement of cash flows.