I have made them before, but this time I did it better, thanks to a link on Pinterest and some tweeking! Here's the link to the directions I went off of, but I wanted to show you how I did it in case you find yourself needing to make graduating caps for little ones.
Here's my little preschool graduate in her cap
Take yarn, or whatever you want to use for your tassel, and cut strips 36 in, 24 in, and 4 in. Don't worry if your measurements aren't exact, it wont matter.