The dwarves are captured by spiders in Mirkword. Bilbo lures the spiders away to save the darves.
Each of the dwarves climb into barrels after Bilbo saves them. The barrels are floated down the river with the dwarves inside and Bilbo, who hadn't made a plan for himself, on top of a barrel.
Smaug, the dragon, his shot by a black arrow, coming from the forges of the true king under the Mountain. Bard, the bowman, had finally killed Smaug.
Bilbo described the Battle of Five Armies as a terrible battle, the most dreadful of all Bilbo's experiences.
Gandalf and Bilbo leave Elrond together and rode toward home. Bilbo had received his gold that the contract Thorin created said he'd receive. They arrived at Bilbos door to see all of the presumed late Bilbos items being auctioned off.
In the end Bilbo is writing his book that he may call, "There and Back Again, a Hobbit's Holiday" Gandalf then rings at the door, along with Balin. They talked about old times and how Lake-Town has a new master, who's wiser and kind.