Dragon goes looking for the most perfect Christmas tree for his home, but when he finds it he can't bear to cut it down, and decorates it where it stands, instead. A day or so later Dragon makes a wreath out of candy... and promises himself that he'll only eat the candy that happens to fall off. He then spends the next while making the candy fall off and eating it, until his wreath is bare and he ends up with a tummy ache. He promises himself next year he'll make a wreath with pine cones. The next day Dragon loses his mittens, so he buys a new pair Then he loses his scarf. Finally, Dragon heads out to buy himself Christmas presents - food, a new scarf. On his way home he meets all his friends and gives them all the presents he just bought. When Dragon gets home he realizes there are no presents left for him... but he's happy. He goes to sleep, dreaming he hears angels singing. Outside his house, Alligator, Beaver and Mailmouse are singing Christmas carols to him.