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1. In a large mixing bowl beat together the cream cheese, butter or margarine, and vanilla with an electric mixer on medium speed until fluffy. Blend in chocolate. Alternately beat in the 8 cups powdered sugar and the 1/3 cup milk. Reserve 3-1/2 cups of the mixture to use in the cake; set aside.
2. To the remaining mixture (you should have 2 to 3 cups mixture). Beat in enough of the additional 1 to 2 cups sifted powdered sugar to make of spreading consistency. Cover and refrigerate the frosting.
3. In a large mixing bowl place the reserved 3-1/2 cups of cream cheese mixture. Add eggs; beat 1 minute at medium speed. Stir together the all-purpose flour, baking powder, baking soda, and salt. Beat into egg mixture alternately with the 1 cup milk, beating at low speed after each addition just until combined. Divide batter among three greased and floured 8x1-1/2- or 9x1-1/2-inch round cake pans.
4. Bake in a 350 degree F oven for 25 to 30 minutes for 8-inch pans or 22 to 25 minutes for 9-inch pans, or until a toothpick inserted near the center comes out clean. Cool in pans for 10 minutes. Remove cakes from pans; cool completely on wire racks.
5. Remove frosting from refrigerator about 30 minutes before frosting the cake. Place one layer on a serving plate; spread with half of the raspberry preserves. Top with second layer of cake; spread with remaining preserves. Top with third cake layer. Spread top and sides with frosting. Makes 12 servings.