Combine butter and cream cheese in a small mixing bowl; mix well. Stir in flour just until blended. Shape dough into a ball; cover and chill.
Roll pastry to 1/4-inch thickness on a lightly floured surface. Cut dough with a 3-inch biscuit cutter. Place 1 teaspoon preserves in center of each pastry circle. Moisten edges of pastry; fold in half, making sure edges are even. Press pastry edges firmly together using a fork dipped in flour.
Bake at 350° for 15 minutes or until lightly browned. Place on wire racks to cool.