In a large mixing bowl, beat together the unsalted butter and cream cheese until creamy and smooth. Gradually add the granulated sugar, egg, and vanilla extract. Mix until fluffy.

In a separate bowl, whisk together the all-purpose flour, cornstarch, baking powder, and fine salt. Gently fold the dry mixture into the wet ingredients until just combined.

Divide the dough in half, wrap in plastic wrap, and refrigerate for at least 2 hours or freeze for 30 minutes.

Preheat the oven to 350°F (175°C) about 30 minutes before rolling out the dough. Line baking sheets with parchment paper.

Roll out the chilled dough to about 1/3 inch thick and cut out cookie shapes with a 2 1/2-inch cookie cutter. Create smaller circles for ears.

Press small circles onto larger cookie shapes to form ears. Chill cookies for an additional 15 minutes.

Bake for 12-14 minutes or until edges are lightly golden and centers are just set but soft. Cool for 15 minutes on the baking sheet.

While cooling, prepare the buttercream frosting by beating butter, vanilla extract, and salt. Gradually mix in powdered sugar and heavy whipping cream until smooth.

Once cooled, frost the cookies and dip in coarse sanding sugar. Decorate with chocolate chips for noses and sprinkles for facial features.