Combine almond paste, sugar, egg and egg yolk in mixing bowl. Beat with paddle on medium speed until smooth. Add butter in 3 additions; beat until light. Lower mixer speed to low; beat in flour until absorbed.
WATER ICING: Combine sugar and liquid in a small saucepan and stir to a creamy consistency. Heat to luke-warm over low heat, stirring constantly. Apply warm; reheat if necessary.
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