Mommy chicken with reversible egg/chick.
Modified this chicken pattern http://www.ravelry.com/patterns/library/spring-chicken
as follows:
CO 9 stitches.
row 1: purl all stitches.
row 2: (k1, increase 2, k1). Repeat.
row 3: purl
row 4: (k1, increase 2, k2). Repeat.
row 5: purl
row 6: (k1, increase 2, k3). Repeat.
row 7: Purl
You now have 27 stitches.

Row 8 : (k1, increase 1, knit7) repeat twice (30 st).

Work in SS until your work is as tall as your finished egg, ending with a knit row.
Knit 2 rows (in the 2nd row I increased 5 stitches so I had 35st on needles), then follow the original pattern from row 7.
After sewing the chicken, I used some clear elastic (the one used for bracelets) to gather the bottom opening.

I used this pattern for the egg:
http://www.ravelry.com/patterns/library/colorful-egg
but when I came to the “knit in stockinette stitch (knit all rows) for 6 rows” I knit it back and forth (not joined in circle).
After 6 rows join again and work in the round.
Chick is the same but in different colour.
Use beads or black yarn for eyes, orange for beak.
Put a VERY small amount of stuffing into the chick (optional).
Sew egg and chick at the opening using mattress stitch.

Sorry for my bad English, please ask if you have any question!

EDIT: I found the egg very hard for little hands to turn, my 3YO always asks for help! Next time, I’ll make the opening wider.