I'm with Jennifer. I'd line up the beds too. Sitting area by the window, etc. maybe add a table and chairs along the right wall for card or board games.

Yes I agree with Jennifer...line the beds up and put the tv on the wall across from the beds. I would get rid of the futon. This brings back memories of my grandparents' finished attic (but no tv...only board games) so much fun :)

I am confused by the futon in the photo, is that the correct size mattress? Seems to me that keeping the futon and eliminating one of the beds would be a reasonable compromise - it can be kept in the seating position until you need to set it down to sleep position.

A few other ideas to toss out. Since you do say you want the sleeping capacity, is a bunk bed workable to save on footprint? I am thinking that could be closest to us in this picture, on the left.

Cluster the sleeping furniture as much as possible toward this closer end of the room, and then cluster the TV and seating area out toward the window end. For that purpose, I think TV on the left will work better than on the right, and keep in mind furniture does not necessarily need to but stuck against a wall. TV on the left, seating in the window bay, and another sofa (futon?) "floating" in the room, facing the TV. (that might even leave enough room to still tuck one of the beds along that right wall in that corner?) A patterned area rug to define that seating area, and probably need a different, smaller coffee table.

Since you are already covering the loveseat with a slipcover, are you sure you can't part with it? If you are ready to dispose of it, it will fit down the stairs by literally dismantling it. It got into that room somehow, though, so might only need to take off the feet. If you do keep it, a better fitting slip cover, maybe something that picks up a darker color from the new area rug.

Thank you all for your ideas. The futon is a double size mattress. I have 7 grandkids, so, I need the beds. I have two memory foam toppers on top of the beds, so I can move them to the floor, for sleeping. I probably should keep the futon for seating/sleeping and chop up the love seat and haul it down the steps. The love seat went up the steps, before we put a wall up to enclose the entry into the FROG. It won't make it around the corner. I moved the futon forward.

I bet the kids love sleep overs at your house!

My husband and I are chuckling about "FROG", we have one but have always just called it "the room over the garage". We have always puzzled over the furniture arrangement as well, and in fact he is in the midst of a project to get a cable TV outlet in a new/different spot in the room so that we can rearrange yet again.

I have always wanted a 'bunk room.' The closest I got was a kid friendly extra room in my previous house.

I wouldn't get rid of the futon if you have to sleep up to 7.

I like the idea of grouping the beds together. It's a cozier look.