Cream butter, and sugar together; blend in extract. Stir in flour, cherries and nuts. Form into two log rolls, 2" x 8". Roll in coconut. Wrap and chill several hours or overnight. Slice 1/4 inch thick slices. Place on ungreased cookie sheets. Bake for 10-12 minutes, or until edges are golden brown. Allow to cool 5 minutes before moving to a cooling rack. Store in airtight container. ****If mixture is dry while mixing all ingredients together, add about 1 tablespoon of milk to mix before rolling into logs.