chunk: In a village in Holland, two American vaudevillians, Con and Kid, who have been travelling in Europe but itch to get back to New York, are stranded penniless in the little inn. As painters and their models sing about the troubles of being a poor artist, the models try to convince the painters to quit their work and have some fun ("By the Side of the Mill"). Overhearing the models complaining, Tina points out that at least the girls have boyfriends. Prompted by this statement Flora discloses that she longs for her painter to say that he loves her, and will one day, marry her ("Loved But Me"). Con and Kid try to sneak out of the inn without paying their bill, but they are discovered and sent to jail. The Innkeeper takes pity on them, however, and arranges for them to work at the inn to pay off their debt.