I bought this shirt at the dollar store the other day.  It is a size adult small and the purple fabric is a scrap that I had laying around.  The wheels in my head started turning that I could make this into a cute shirt for my daughter.
First I took the sleeves off and turned the shirt inside out. I laid one of her shirts on top of the big one.  Then using her shirt as a guide I cut the big shirt a little bigger then her shirt.
As I was putting this post together I realized that I didn't take any pictures over the next few steps.  What I did was sewed it together including a hem at the bottom.  I also put the sleeves back in the shirt.
I turned the shirt outside out and with a pencil drew a butterfly in the upper right corner of the shirt.
And bottom left corner of the shirt.  I placed the scrap fabric under each drawing and pinned it to the shirt. 
I sewed along my drawings as best as I could and then cut the shirt inside the butterfly.
Here is the finished shirt.  I had extra fabric from the bottom of the shirt so I also made a couple of headbands.
Here is my wearing the shirt
 
 
 
 
 
 
 
 
 
