This summer my girls have been invited to a lot of birthday parties. My savior has been a sewing pattern I picked up for 50 cents or so at a fabric fair.
It was previously made by McCalls (4051/8077) but I see Simplicity 4928 makes one now. (I may have even seen it recently at Walmart...)
I've made all of their friends letter pillows with their first initial. It only takes 1/2 yard of fabric and I let the girls pick out a print that suits their friend (i.e. peace signs, soccer balls, softballs...)
I wanted to do a little more so my mom gave me this idea off of Pintrest. It is a beaded monogram letter using plain old cardboard, hot glue, and strands of Mardi Gras beads.
http://blog.mardigrasoutlet.com/2012_02_01_archive.html