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Use a router to cut a 2-1/2" U-shaped opening in the center of one of the 12" x 3-1/2" x 1" boards (Image 1).
The four boards (two 12" x 3-1/2" x 1" boards and two 16" x 3-1/2" x 1" boards) will form the sides of the box. The 16" x 12" sheet of 3/8" plywood will form the bottom of the box. Use 2" nails to nail the boards and plywood together to create the box (Image 2).
Using a miter box and saw, cut both ends of the two 6" x 3-1/2" x 1" boards at a 45-degree angle. Using a hammer or nail gun, secure these two boards at the corners surrounding the U-shaped opening. They will act as a funnel for screws, nails and bolts.
Cut about 4" from the bottom of a water bottle. Cut 1" slots at the open end of the piece of the bottle you just cut (Image 1). Cut a large circle from the other end.
Glue the slots of the water bottle to the outside of the U-shaped opening. For a secure fit, drill small screws into the slots to hold them in place (Image 2).