Great question! I use IrfanView to edit the SIZE of the picture and I currently don't edit out the background unless I absolutely have to... and when that time comes I use Paint. But it doesn't look too good lol. Alot of people here just take and use a solid colored sheet/curtain/blanet/towel as a back drop behind the cake when taking the picture or something like those poster board presentation panels.. it's 3 panels to it and would surround the back ground of the cake and give it a solid back ground. I think that would look good. 
That is a great question. I use Photoshop and it is very user friendly. I bought an extra large piece of black foam core board and sliced it down the middle width wise. Not all the way through though! That way it opens and closes. It is great for setting up on my dining room table so the cake is sitting on black and also has the black in the background. It stores easily too. Sometimes it looks grey and I use photoshop to make it darker.
I have used my tablecloth, just lifted it up on one side ( on my bow cake)
.
Other times I have just used cardboard (on welcome home cake) . My teacher recommends going to the scrap bin in your store where you buy material from and buying up scrap pieces of solid colours. then put them up behind your cakes to see which colour compliments the photo.
Just a few ideas to think of....
I found this website, but haven't tried it out yet. Has anybody tried this site or one like it?
http://www.freephotoediting.com/photoediting/index.htm#Samples
I use Picasa which is free from Google....it's decent but VERY basic. Good for free....can't afford Photoshop at this point!
I just figured out how to edit the background with Paint Shop Pro... lol. Had to look it up online how to do it but I got it right and edited three images with it just now... it's fairly easy to do if you already have the program... but it's not a free program...
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