Preheat oven to 350° and line baking sheets with parchment paper.
In a large bowl, cream together softened butter and sugar using an electric hand mixer or stand mixer. Start mixer on low speed and gradually increase to medium speed.
Then mix in egg and vanilla until well combined on medium speed.
Next add in flour and baking powder. Start mixer on low speed. Gradually increase to medium speed as dough starts to come together. Mix with beaters until combined. Do not overmix. NOTE: Dough may not come all the way together into one smooth ball (see picture). Dough will finish coming together as you form a disc to begin rolling it out.
Dust work surface and rolling pin with flour. Leave a small pile of flour to the side to dip cookie cutter in. Divide dough in half. Roll out dough until 1/8 - 1/4 inch thickness. Cut out desired shapes with cookie cutters. Repeat with remaining half of dough. Scraps can be rerolled and cut out. NOTE: If you roll your dough out on the thicker side, it will not hold its shape in the oven as well as thinner cookies.
Place cookies on a parchment lined baking sheet a couple of inches apart.
Bake at 350° for 7-12 minutes. Timing is dependent on size of cookies. A medium sized shape cookie will take approximately 9-11 minutes. Start checking cookies at the 8 minute mark.
Bake until cookies are set. The cookies will still look pale when you pull them out of the oven. Do not overbake.
Allow to cool on baking sheet for 5 minutes.
Remove cookies to cooling racks to finish cooling completely.
Then decorate with your favorite frosting or cookie glaze.