The girls want new furniture and go looking for a used couch, in a haunted house. Lenny and Squiggy go with Laverne and Shirley to the haunted house to help them remove a couch if they buy one. Of course, the cast start to disappear one by one until there's only the girls left, they can't get out. In the end discover that it is the owners of the house who are trying to scare people away so they don't have to move. Shirley discovers that Abe Lincoln once slept in the house and suggests they have the house marked as a piece of history which saves the building.

Milwaukee's most prominent citizen, Charles Pfister Krane, decides to make Laverne and Shirley his newest singing discovery, a singing duet called "The Rosebuds".