I also made this for my cousin's fourth birthday in March:
Crochet Breakfast by Jessica Spencer, Beansprout Creations (Rav link)
I just used scrap yarn (acrylic and machine-washable cotton) that I had in the stash. My cousin loves to pretend to cook for people so I thought he would like it, and he does.
I was very lucky with my freehand embroidery on a scr ap of felt for the bag (the bag was from some t-shirt sheets we bought a little while ago). Overall, this is one of the projects I am the most proud of, in part because of how well it turned out but also because I only used materials I already had, and because it was a present that is so perfect for my cousin.