Cream butter; gradually add 3/4 cup sugar, beating well. Add the egg, beating well.
Sift together flour, baking powder, nutmeg and salt; add to creamed mixture alternately with the milk, mixing well after addition.
Stir in the vanilla. Pour batter into greased and floured 9-inch square baking pan.
Combine apples, 1/3 cup sugar and cinnamon; mix well. Sprinkle over batter. Bake at 350 degrees for 25-30 minutes or until tess done.
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