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In a war between Bulgaria and Serbia, the Serbian soldiers are fleeing. A Serbian soldier surprises Raina, the heroine, by entering her bedroom for shelter. The Serbian officer is a Swiss mercenary soldier fighting on the Serbian side, his name is Captain Bluntschli. Raina Petkoff had been dreaming of her fiancĂ© Sergius; about how valiantly he had led the Bulgarians to victory. Bluntschli is a soldier who prefers a supply of chocolates to bullets when he goes to the front. He gives an account to Raina about the Bulgarian victory, which according to him, was a fluke as someone had forgotten to supply the Serbian army with ammunition. Her romantic notion about soldiers receives a shock when he tells her he is afraid and unwilling to die. However, when the pursuers enter the house, she hides Bluntschli successfully. Only Louka, the maidservant notices the pistol and knows that the fugitive is hiding in the room.
After lunch, Bluntschli helps Major Petkoff and Sergius to make arrangements for the transport of troops. Major Petkoff asks for his coat and Raina is apprehensive that he may discover the photograph, which she had put in the pocket for her "Chocolate Cream Soldier." Sergius learns the true identity of the "Chocolate Cream Soldier" and challenges Bluntschli to a duel which Raina interrupts and expresses her real feelings for Bluntschli. Louka succeeds in securing Sergius for herself and Major Petkoff and his wife give their consent to Bluntschli to marry Raina.