Preheat oven to 350 degrees. Grease and flour two 8" or two 9" round cake pans. Drain cherries and add enough milk to the juice to make 1 cup. Chop the cherries. Combine cake flour and baking powder; set aside.
In large bowl with electric mixer, beat shortening with sugar and almond extract until well combined. Add the egg and beat well. On low speed, alternately add milk mixture and flour mixture beating just until combined. Stir in cherries.
Spread batter into prepared pans. For 9" pans, bake 20-25 minutes. For 8" pans, bake 30-35 minutes. Layers are done when a toothpick inserted in center comes out clean. Cool layers in pans for 10 minutes. Invert and remove cake layers from pans. Cool thoroughly before icing.
Divinity Icing: In the top of a double boiler, combine sugar, corn syrup, water and egg whites. With an electric mixer on low speed, beat the combined ingredients for 30 seconds.
Over boiling water with electric mixer on high speed, beat mixture constantly (about 7 minutes) until peaks begin to form. Add the vanilla; beat until stiff peaks form.
Frost the bottom layer and sprinkle with 1/2 cup of coconut. Add the remaining layer. Frost top and sides; then sprinkle with coconut. Place reserved cherry in center of cake.