Sift first 4 ingredients and 1/2 cup sugar together in bowl. Cut in shortening until crumbly. Stir in egg, milk and apple, mixing well. Fill greased muffin cups 2/3 full. Bake at 350 degrees F for 20 minutes. Mix 1/3 cup sugar and cinnamon in small bowl. Remove doughnuts from pan and roll in butter, then in sugar mixture.
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