Cream shortening and 1 cup sugar; add egg and beat well.
Stir in milk and potatoes.
Combine next 5 ingredients; add to potato mixture, stirring well.
Place dough on a lightly floured surface; knead lightly.
Roll out to 1/2-inch thickness.
Cut with a floured 2 1/2-inch doughnut cutter.
Heat 3 to 4 inches of oil to 375°; drop in 3 to 4 doughnuts at a time.
Cook about 1 minute on each side or until golden brown.
Drain on paper towels.
Combine 1 cup sugar and 1 1/2 tea spoons cinnamon; sprinkle over doughnuts.