Baked Doughnut Puffs

2 Tablespoons shortening

1/2 cup sugar

1 egg

2 cups flour -- sifted

1/2 teaspoon salt

1 tablespoon baking powder

1/2 teaspoon ground nutmeg

1/2 cup milk

1/2 cup chopped walnuts

1/4 cup powdered sugar

1/2 teaspoon ground cinnamon

1/4 cup butter -- melted

Cream shortening, sugar & egg until light and fluffy. Sift together flour, salt, baking powder and nutmeg. Add alternately with milk to creamed mixture. Mix well to a stiff dough. stir in nuts. Drop by tablespoon into well greased small size muffin pan cups. Bake at 400? for 20 minutes. Combine powdered sugar and cinnamon in paper bag. Dip top of doughnut in melted butter, shake 2 or 3 at a time in bag with sugar.