When our daughter got married in 2001, the cake was for 250 people, and the price quote was $600, which included a sheet cake as well as the 3-tier cake. It was lovely, decorated with flowers like she and the attendents carried, and what were in the table centerpieces. The cake itself was delicious too.
Because most of the wedding guests were from the groom's side of the family, and because his parents are naturally generous people, they offered to help with the cost of the reception, even though DH and I had said that it wasn't necessary. Still, they wanted to do something, and I didn't want them to feel 'hurt' by not accepting their sincere offer. So I told my daughter that she should handle it, and whatever was decided would be fine with me and DH. So the groom's parents paid for the wedding cake, which I thought was an incredibly genrous thing to do.
The cake was delivered, then assembled in the reception room, on its own display table. Dinner went well, and the party was going great, with a disk jockey and lots of festivities, when someone came running over to tell me that the cake had collapsed! I looked over toward the cake table in shocked horror, just as my daughter looked at me. She sent someone to tell me not to be upset. HUH? She's cool...so I guess I could be too...but the groom's mother was beside herself. She came to me right away, and said "what should we do?...we paid a lot of money for that cake, you've worked in catering, how should I handle this?" There was now a lot of commotion going on, and confusion. Daughter was talking to the banquet manager, who had been near the table when the cake fell. He later assured me that no one had 'caused' this to happen. No guest or server had bumped the table or knocked over the cake.
I told the groom's mother to get a written statement from the catering manager, and other witnesses, then call the bakery first thing Monday morning, and tell them what happened. She did. The bakery first tried to make excuses. It must have been that someone knocked it over. "No, I have witness statements that no one was near the cake". Well, it was hot in the banquet room, and that affects the integrity of the cake. "No, the room was air conditioned, and so cool that people were going outside to get warm". Well...excuse, excuse, excuse...but each time she came back with a rebuttal. Finally the bakery rep asked what she thought would be a reasonable offer. The groom's mother said ... "Well, you know the cake is a centerpiece of any wedding. There are photographs and the cutting ceremony, and the special ritual of serving a piece to each guest...they didn't get any of that. The only cake that was fit to be served was the sheet cake. Have you ever tried to serve 250 guests from a sheet cake?" ... the rep said "would a full refund be acceptable?" She had them make it out to the bride and groom.
It really was the bakery's fault, by the way. They had elevated the layers on pillars with nothing for the pillars to stand on except the cake itself. So the pillars sank into the cake until the top two layers collapsed into the bottom layer, and then landed with a spat on the floor.
Well, anyway, the story isn't about the cost of the cake, which is the actual topic. Even 7 years ago, $600 was about average for a decent cake. We saw some at bridal fairs that cost twice and triple that much.
I made my own wedding cake, and I am a professional. It was a nightmare - there is not time the day before your wedding to finish a cake! Thankfully, part of pastry school includes pastry professional friends, and one of my bridesmaids was also a pastry chef and saved me 
