Mix butter, sugar, and eggs until well blended.

Add baking powder, vanilla, baking soda, salt, and sour cream and stir well.

Add flour and gently combine. If too sticky, add just a little more flour and refrigerate for about 30 minutes.

Roll out dough on a floured surface and cut with a circle cookie cutter (I used a 2 3/4 – 3 inch diameter circle cookie cutter).

Bake at 350 ℉ for about 9 minutes (you don't want to overcook them!).

Frosting: Combine all ingredients and mix well. If it's too thin, add more powdered sugar and if it's too thick, add a little more milk.

Assemble the Cookies: Frost the cookie and immediately after add the sprinkles to the top third of the cookie with red sugar crystals (we held the edge of a little bowl to cover the rest of the cookie while we sprinkled the crystals on and it gave the hat a rounded edge).

Next, sprinkle the bottom third of the cookie with coconut (and come a little up each edge to meet the hat) to make Santa's beard. If your frosting dried quickly, you can put a drop of water on your finger and spread it on the frosting- the coconut should stick perfectly after that.

Place a marshmallow on the end of the hat, the chocolate chips for the eyes, and the red hot for Santa's nose.