As Billy walks into the woods to have a picnic, Yogi and a giant, feral version of Boo-Boo (from The Yogi Bear Show) come to steal his basket, and he escapes by hiding in a cave. Then, Billy is taken to the mushroom lair of the dwarves where King Beardbottom tells him the story on how the different races split the food-services industry,after the conference of Rivendell after the The Cold War,in which Ronald Reagan allows each race to chose which food to make (The meeting is a parody from the Lord of the Rings.)Then, the king sends Billy to infiltrate the elves' cookie factory to deactivate their force field, so the dwarves can assault the factory. Finally, after a fierce battle (censored out "for younger viewers", by a single clip of a pink koala continuously licking a eucalyptus leaf) and Billy's words, the elves and dwarves decide to work together and split the profits.