Using a worsted weight yarn (for Christmas, pick red and/or green with a metallic thread, widely available at Wal-Mart, etc.) cast on on your Barbie Knitting Machine.
Knit until the piece measures about 6-8" beyond the bottom of the machine when pulled slightly (length is not critical, it just needs to be long enough to tie around the creature's neck).
Cut the yarn, leaving a 12" tail. Change to another color of yarn and knit a few rows (this will be unraveled later).
Remove the yarn from the tensioner and crank around until knitting falls off the machine. To close the bottom end of the tube you've created, just pull on the tail of yarn left from casting on. To close the upper end of the tube, use a yarn needle to thread the tail of yarn through all stitches in the last row before the waste (contrast) yarn was used.
Unravel the waste yarn. Pull the tail of yarn up tight. You should have a tube about 14-16" long.
Now, make a tassel for each end of the scarf. Use the same yarn as for the scarf, contrast yarn, or even metallic yarn to match the metallic thread in the scarf.
To make a tassel, cut a rectangle of cardboard about 3" wide. (Actually,
I use the lid to a rectangular plastic container.) Wrap the yarn around
this about 20 times (more if you want a fatter tassel).
Cut the yarn being sure that the starting end and the ending end are
both at the same edge of the cardboard.
Cut an 8-12" piece of yarn, slide it under the yarn, against the cardboard
at the end *opposite* the cut ends of the yarn. Tie tightly. Cut across
all the yarn at the opposite side of the cardboard.
Take another 8-12" length of yarn and wrap it around the tassel twice about 1/2 - 3/4" below the top. Tie tightly, and use a yarn needle to pull the ends through into the center of the tassel and out the bottom. Shake out the tassel and trim the bottom to even up any uneven ends.
Attach one tassel to each end of the scarf and hide the yarn ends inside the scarf.
Tie around the neck of a suitable cute toy animal and present to the nearest suitable small child.