Mix the butter and the cream cheese in a large bowl then slowly add sifted flour until the ingredients form a soft dough. Cover and refrigerate for 2 hours.
Sift some powdered sugar on a cutting board (just a dusting- enough so dough won't stick when you roll it out). Gather a ball of dough the size of a walnut and roll on the cutting board into a circular shape. Sprinkle more powdered sugar as needed so the dough does not stick.
Place a small spoonful (approx. 2 teaspoons) of pineapple preserves in the middle of the circle. Either roll the dough up or fold over and seal the edges.
Place on a cookie sheet lined with parchment paper and bake at 350 degrees for 10-15 minutes (until the cookies begin to lightly brown on the bottom and edges.)