PREPARATION:

1. Combine butter and cream cheese in large bowl; beat until smooth. Gradually add flour to butter mixture, blending until mixture forms soft dough. Divide dough in half; wrap each half in plastic wrap. Refrigerate about 1 hour or until firm.
2. Preheat oven to 375°F. Roll out dough, half at a time, on floured surface to 1/8-inch thickness. Cut into 2-1/2-inch squares. Spoon 1 teaspoon preserves into center of each square. Bring up two opposite corners to center; pinch together tightly to seal. Fold sealed tip to one side; pinch to seal. Place 1 inch apart on ungreased cookie sheets. Bake 10 to 15 minutes or until lightly browned. Remove to wire racks; cool completely.