Combine butter and sugar. Do not take this mixture to a "light cream." Think "incorporate" ? not "cream." Just make sure the mixture is smooth ? no butter lumps.
In a small bowl mix egg, milk/cream, and extracts. Add this mixture all at once to the butter and sugar. Mix just until the egg is broken. The mixture will "curdle" but that's not a problem.
In another small bowl, mix the flour and baking powder. Add these dry ingredients to the liquid ingredients in the mixing bowl. Process to form dough.
Preheat the oven to 325 degrees F. Line 2 baking sheets with parchment paper. It's just that simple! The beauty of this dough is that it does not need to chill before using it. Simply flour a work surface. Knead the dough a few times to smooth it out and with a rolling pin, roll dough. Cut into desired shapes. The dough scraps can be used several times. Bake for 8 to 10 minutes, or until golden brown. Cool on a wire rack.
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