Peanut butter, chocolate chip, sugar, oatmeal raisin, snickerdoodle -- you won't find too many foods kids like better than cookies. Lucky for the budget-conscious host, they can also be incredibly cheap to make, as long as you go homemade. Baking staples like flour, sugar, eggs and baking soda are very inexpensive ingredients, especially if you choose the store brand. Chocolate chips are the only piece of the puzzle than can cost much more than a buck, but even then you can find great deals if you look for sale items or generics. Kids typically don't notice whether the chocolate is gourmet or the standard fare.
For a little extra birthday appeal, look for cookie cutters in fun shapes at the dollar store and decorate your stars, hearts and bunnies with bulk sprinkles.