Edith ("The Lonely Doll") struggles with the choice of a Christmas gift for Mr. Bear, finally realizing that something made by hand would be far better than something bought in a store. A knitted muffler seemed a perfect choice, especially since Edith, Mr. Bear and Little Bear are planning to spend the holidays with cousins Charles Bear and Albert Bear in the snowy hills of upstate New York. Edith knits whenever Mr. Bear isn't watching, hiding her project in a woven basket without realizing how much yarn she's been using. When the presents are opened on Christmas morning, Mr. Bear's gift is long enough for three bears! Edith is miserable about it, until she finds the perfect solution. She cuts the muffler into gifts for both Mr. Bear and his two cousins, and the day ends very happily.