When your lines are drawn, stitch over each one with blue thread, as shown. Note: There is no need to backtack at the beginning and end of your lines of stitching, since these outside edges will be bound with bias binding later on.
Using your washable ink marker and ruler, draw a line 1.5″ from one of the long (7″) sides of your patch. Stitch over this line with red thread.
Using a spool of thread, round off each of the four corners of your patch, as shown, and trim away with shears.
Apply bias binding around the perimeter of the patch. (Head over to Angry Chicken for an incredibly helpful and entertaining bias binding video tutorial.)