Prepare the room for the work. Remove the furniture in the area, if possible. If not, cover everything in the room with plastic dropcloths. Plaster is very messy and the dust will get everywhere. You also need to protect yourself -- wear safety glasses, gloves and a respirator to protect your lungs.
Remove any hanging debris from the cove. Chipped plaster is typically uneven and you may have larger chunks hanging down. Remove what you can by hand, and use a chisel to scrape the area clean.
Prepare the plaster mix. Mix your plaster according to the manufacturer's instructions. A plaster mix or Plaster of Paris typically just needs water. Mix everything in a bucket and work quickly because plaster sets rapidly.
Apply the plaster to the chipped area. You will only need a thin coat. Put a little plaster on a trowel and sweep it on to the surface, pressing down on the trowel as you go to smooth it out. Scrape away any excess with the edge of the trowel. Make sure the patch is as even as possible. Let the plaster set for 30 minutes.
Sand down any imperfections. It's rare to be able to apply plaster perfectly. Use a hand block sander with a fine sandpaper and smooth out the patch until it blends with the rest of the ceiling. If necessary, paint over the patch so it matches the rest of the cove ceiling.