Living the Dream
Stress abounds in the office. Andy feels torn between his office life and his budding acting career. Angela's life is in ruins because the Senator left her and the county confiscated her cats. Jim and Pam, on the other hand, seem happier than they've been in quite some time, ever since Jim decided to take a break from his Philadelphia job to spend more quality time with Pam and the kids.
Dwight arrives at the office and announces that, after 20 years of training, he has finally obtained his black belt in karate. He invites the entire office to a lunchtime martial arts presentation. David Wallace arrives to fire Andy for using company funds to support his acting hobby, but Andy beats David to the punch by announcing that he's quitting to focus on his career in entertainment. David is relieved.
Jim returns to his desk to find that Clark is sitting in it, and he's reluctant to give up the desk. Jim explains that he'd like to be close to Pam, but Clark argues that he's working hard to impress David Wallace. Andy announces that he's quitting Dunder Mifflin, but the rest of the office staff is not optimistic about his chances.
Jim takes Clark's desk in the annex and tries to form a friendly bond with his new desk mate, Pete, but it's awkward. Darryl tries to be brutally honest with Andy by telling him that he's not talented, but Andy doesn't get the message. Meanwhile, Dwight's karate instructor arrives to perform the ceremonial changing of the belts, but he has trouble getting Dwight's belt off and is eventually forced to cut it off with scissors.
After he has received his black belt, Dwight performs a karate demonstration in which he endangers most of the office staff. In a side conversation, Dwight's karate instructor has a private conversation with David Wallace, telling David that Dwight loves this office more than anything in the world. David realizes that Dwight will be the perfect office manager.
Later, David Wallace meets with Jim to get his advice on hiring Dwight as the new office manager. Jim thinks it's a fantastic decision. Meanwhile, Nellie and Kevin talk to Andy about his decision to chase his Hollywood dream. Nobody believes in him, but Andy believes in himself and that's all that matters.
Throughout the day, the rest of the office staff continues telling Andy what a mistake he's making. Eventually, Andy begins to doubt his chances in Hollywood. He heads into the conference room to beg David Wallace for his job back, but David sees it coming and tells Andy that he can stay on staff as a salesman. Then, David calls Dwight in for a private meeting. It's the moment Dwight has been waiting for.
Dwight dramatically accepts the promotion to branch manager, which David has come to expect at this point. David tries to announce to the staff that Dwight will be taking over as manager, but Dwight can't contain himself. He jumps on a desk and shouts the news to the others, who applaud and congratulate him on a mission finally accomplished. Dwight's first managerial order is to give Jim his desk back.
Dwight promotes Jim to Assistant Manager, which Jim sees as a wonderful opportunity to torment Dwight. Andy flip-flops between following his dreams and staying on staff as a salesman, then decides that he must get himself fired so that he has no choice but to follow his dreams. After a heartfelt goodbye song, the staff says farewell to Andy.
Oscar invites Angela to stay with him in his apartment until she gets back on her feet, and she accepts the offer and confesses to Oscar that she's in love with Dwight. Meanwhile, Darryl tells Jim that the connection in their Philadelphia office just sent word out that the company scored a serious investor, but that the next three months will be full of travel. Thinking of Pam, Jim tells Darryl that he can't do it. Unbeknownst to Jim, Pam overhears the entire conversation.