What do you mean by setting cookie in application controller? You would set cookie in browser corresponding to some controller action. If you want to set the cookie for all actions then you may consider using a before filter and apply that filter to all your controller actions.
You can set and delete cookies as shown below:
cookies[:key] = {
:value => 'a yummy cookie',
:expires => 1.year.from_now,
:domain => 'example.com'
}
cookies.delete(:key, :domain => 'example.com')
Please note that if you specify a :domain when setting a cookie, you must also specify the domain when deleting the cookie.
e.g. cookies[:user_name] = "david"