In food processor place cream cheese, butter and powdered sugar. Process on and off until mixture comes together in a ball. Add extract, process until incorporated.
Place dough on powdered sugar sprinkled board. Add a few drops of color to center of dough and knead until evenly colored. Can make several colors if desired. Roll dough into ropes, cut into small pieces. Roll each piece into a ball, dip in granulated sugar and place on waxed paper.
Flatten each ball with fork. Or put each ball into candy mold following mold directions. Let stand 2 hours to dry. Store in tight tin in refrigerator or freezer.