You’ve seen cartoons where a devil version and an angel version of a character tell him how to behave. The idea goes back to the silent film era, although in “Bobby Bumps at the Circus” (1916) only features a generic devil and angel.
The devil rises up from, well, you know where. The angel just appears from nowhere.
In the end, Fido listens to the devil. After all, the circus owner does owe him and Bobby for a performance. Fido then takes the money (a $500 bill?) the circus owner has dropped to Bobby’s father, who can now pay his debts.