Eddie bought a few left over roses from Dick and knocks on Elsie Darling's door to give them to her. She starts crying when she sees him in Percy's pajamas. Elsie Lilly and Dick enter and once again he confesses his love for her. This time she accepts it (“Holding Roses”). Eddie tells Elsie Darling that Madame Matroppo is suspicious of their “marriage” so they decide to speak very lovingly to each other in the hope that she can hear them. Unfortunately, Percy and Georgina hear them and angrily confront them. But Eddie and Elsie Darling have learned how to handle themselves. Eddie explains the facts, and both of them finally stand up to their partners. Eddie orders Georgina to sit down, and she does. The delighted clerk shouts admiringly, "Very Good, Eddie!” (“Finale”).