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Beat butter and cream cheese until well combined.
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Add sugar, beat until fluffy.
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Add egg, vanilla, almond extract; beat well.
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In medium bowl mix flour and baking powder (or sift).
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Add flour mixture to cream cheese mizture; beat until well combined.
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Divide dough in half.
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Cover and chill 1 1/2 hours or until dough is easy to handle.
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On floured surface roll dough to 1/8" thickness & cut with cookie cutters.
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Place on ungreased cookie sheets.
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Bake in 375 degree oven for 8-10 minutes or until slightly browned.
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Remove to wire racks to cool.
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FROSTING:.
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In bowl beat powdered sugar, butter, and almond extract until smooth.
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Beat in enough milk until frosting is of piping consistency. For spreadable frosting, add a little more milk.
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Stir in a few drops of food coloring, if desired.