Interior wall hole repair ideas

Thanks for all the ideas so far. I think I omitted an important piece of info, in that the bunk lifts up from underneath to convert it to a storage area accessed from an exterior door so the mattress platform swings right past this area. It is a very handy feature, but would require the repair to be more or less flush so that it doesn't interfere. I suppose I could shave the plywood supporting the mattress if need be. I can't really convert it to a photo board or anything since it is the headboard area of the lower bunk where you would normally put your pillows when sleeping. I'm leaning towards using the plastic strip idea at this point, and if it doesn't last might have to replace that panel.

I put my finger into the hole to root around a bit, and it did not seem like it was grungy in there like I think a water leak would be. Also, I can access the base of that same wall from the aforementioned storage area, and there are no indications of water damage on the floor/wall joint. I think it was a strong kick that did it.

The corporal punishment was a bit of a joke, as one of the kids was not mine, so much as I would have preferred to mete that punishment I held back and expressed my dismay only to my kid. I did not want to obligate the parents of the other kid to think they needed to do something to help with the repair (we're all friends) so it's just a thing. I basically realized later that the repair was more tricky than I thought, hence this post.