Mix and sift flour, baking soda, powder and salt; add nuts and mix. Cream butter and add sugar gradually and cream until fluffy. Add well-beaten egg and chocolate. Add extract to milk. Add dry ingredients alternately with milk to creamed mixture, mixing just enough after each addition to combine ingredients. Drop by spoonfuls on ungreased baking sheets. Bake in a preheated oven for dozen minutes. When cool spread with chocolate frosting. Frosting: Combine chocolate, slightly beaten egg yolk, and cream; add sugar and mix well. ----