In a large bowl, cream the butter, cream cheese and sugar until light and fluffy. Beat in egg yolk and extract. Combine the flour, baking powder and salt; gradually add to creamed mixture and mix well. Stir in 3 cups coconut. Cover and refrigerate for 1 hour or until dough is easy to handle.
Roll into 1-inch balls and roll in the remaining coconut. Place 2-inches apart on ungreased baking sheets.
Bake at 350 degrees for 10–12 minutes or until lightly browned. Immediately press a chocolate kiss into the center of each cookie; sprinkle with coarse sugar. Cool on pan for 2–3 minutes or until chocolate is softened. Remove to wire racks to cool completely