Preheat oven to 325. Generously grease and flour bundt pan.
Make cake batter as directed on box. Pour about 2 cups of batter into the bundt pan. In a small bowl, pour about 3/4 cup of batter. Stir in food coloring and extract. Carefully pour pink batter over the white batter already in the bundt pan. Then, carefully pour remaining white batter over the pink.
Bake as directed on box. Check with a toothpick. Cool about 10 minutes. Invert onto serving plate or cooling rack. Cool completely, about 1 hour.
In a small bowl, mix icing ingredients. If necessary additional milk may be added 1 tsp. at a time until spreadable and smooth. Spread icing over cake.
Garnish with crushed candy canes or crushed starlight peppermints, if desired.