I think the "demon" is actually supposed to be a monkey. It looks like an old table knife handle to me with A K being the owners initials. Other than that I have no clue....
I see the "demon" as another dog, sitting like an old man holding a cane, but tail between it's legs, ear flopped on the side of his face, scruff hanging from it's chest, barking orders at the other dog. I do read it as "oves" as being said... I wonder if that means anything in German? I saw several of this style ( but not as funny) as having been made there.
I was just about to say I think your "demon" is a monkey, but I see NOLA_Ken beat me to it! Your pictures are not in focus and it's difficult to really see the detail. Try typing what the monkey is saying into Google translate and see what comes up. It seems to me that I have seen this or a similar theme depicted before. With the initials on the handle and the word as well as the scene Google is your friend here. Also try eBay too as something may turn up there.
I was just about to say I think your "demon" is a monkey, but I see NOLA_Ken beat me to it! Your pictures are not in focus and it's difficult to really see the detail. Try typing what the monkey is saying into Google translate and see what comes up. It seems to me that I have seen this or a similar theme depicted before. With the initials on the handle and the word as well as the scene Google is your friend here. Also try eBay too as something may turn up there. I think the initials A.K. may be the maker.