Khaka Peü Peü arrives in Danville to challenge Phineas and Ferb after the boys are mistaken as a superhero (while wearing an indestructible suit they designed to safely conquer their newly built extreme skate-track) known as The Beak. With the super villain wreaking havoc, it's up to Phineas and Ferb to thwart him while Dr. Doofenshmirtz tells the people of the Tri-State area that he is in charge, in hopes that they will actually just go along with it. Meanwhile, his brother Roger is worried that everyone will blame him for the recent super villain catastrophe so he decides to make Doofenshmirtz Mayor.

Phineas and Ferb build the ultimate lemonade stand and begin to offer franchise opportunities. Meanwhile, Candace and Stacy's relationship is put to the test when Candace feels she must pick between their friendship and busting her brothers, while Dr. Doofenshmirtz creates a "Paper-Cut-Inator" so that he can make millions selling band-aids.