1 pkg. (2 layer) yellow cake mix
1 pkg. (4 serving size) Jell-O vanilla flavor instant pudding
1 1/3 c. water
4 eggs
1/4 c. oil
2 c. Baker's angel flake coconut
1 c. chopped walnuts or pecans

Blend cake mix, pudding mix, water, eggs and oil in large mixing bowl. Beat at medium speed of electric mixer 4 minutes. Stir in coconut and walnuts or pecans. Pour into 3 greased and floured 9-inch layer pans. Bake at 350 degrees for 35 minutes. Cool in pan for 15 minutes; remove and cool on rack.

COCONUT CREAM CHEESE FROSTING:

4 tbsp. butter
2 c. coconut
1 (8 oz.) pkg. cream cheese
2 tsp. milk
3 1/2 c. sifted confectioners sugar
1/2 tsp. vanilla

Melt 2 tablespoons butter in skillet. Add coconut. Stir constantly over low heat until golden brown. Spread coconut on absorbent paper to cool. Cream 2 tablespoons butter with cream cheese. Add milk. Beat in sugar gradually. Blend vanilla. Stir in 1 3/4 cups of the coconut. Spread on tops of cake layers. Stack and sprinkle with remaining coconut.