Basically, cut them off just below the start of the curve (one inch below) then turn the socks inside out.
Fold the end so it is on the inside of the sock (side that is facing you now) starting at the fold lay your elastic down and "mark" where the elastic ends.
This is where you will sew your straight line. Sew a straight stitch all the way around (be sure not to sew the socks together as you are working in a circle) leaving a 1/2 inch area open and un-sewn.
Instructions will continue in the next post.