It depends on the nature of the wood, and upon how it will be used. For instance, a cutting board has to take repeated impact from sharp objects, so you would be better off with an oil finish. A filmy finish like wax or shellac will be more likely to crack or break.
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Most stain is applied with a brush, a roller, or spraying. The manufacturer's instructions will advise the best method to suit your chosen stain.
Your wood must be clean and dry. That means all dirt and residual paint should be removed by washing and scraping. If you want a smoother surface, you can sand the wood, which helps remove dirt and...
