When I moved in with my boyfriend last summer we both had beds, but no couch. Our loft is fairly spacious, so we decided to convert one of the bed frames into a lounge couch for the living room. This way, we have the benefits of a couch and a guest bed too.
We took the headboard off of a full sized Dalselv bed frame from Ikea and re-attached it to the long side of the bed. We marked equidistant spaces for the bars, drilled holes for them, and purchased another piece of lumber to cap the top of the headboard.
I purchased a futon cover for the mattress, and covered some giant pillows for the backrest. I used cotton fabric including a bunch of Amy Butler prints. It is so comfy that I may not ever be able to go back to a regular couch.