Beat butter and shortening on medium speed until creamy; gradually add sugar and beat well.

Combine flour, baking powder, and salt, and add to butter mixture alternately with milk and water. Beat on low until blended after each addition. Add extracts and mix gently.

In a separate bowl, beat egg whites until stiff peaks form; fold into the batter, about 1/3 of the mix at a time.

Bake in greased and floured 9" rounds or a lined cupcake tin for 16-20 minutes at 350.