In a small bowl, cream butter and confectioners' sugar until light and fluffy. Beat in egg and extracts. Gradually add flour and salt; mix well. Divide in half; flatten and wrap each portion in plastic wrap. Refrigerate for at least 30 minutes or until easy to handle.
On a lightly floured surface, roll dough to 1/8-in. thickness. Cut with floured 2-1/2-in. donkey and elephant cookie cutters. Place 2 in. apart on baking sheets coated with cooking spray.
Bake at 375° for 10 minutes or until lightly browned. Remove to wire racks to cool.
For frosting, in a small bowl, beat the butter, confectioners' sugar, vanilla and enough milk to achieve spreading consistency. Tint some frosting red and some blue; leave some white. Frost cookies; decorate as desired. Yield: about 5 dozen.