Preheat the oven to 350 degrees.
In a bowl, sift together the flour, baking powder, and salt.
In the bowl of an electric mixer, with the paddle attachment on, cream the butter and sugar together until just combined. Add the eggs and extracts and beat until well combined. Then, add the sifted ingredients and beat just until no streaks of flour remain. Stir in the chocolate chips.
Line a baking sheet with parchment paper. Divide the dough into four balls, and then shape them on the baking dish into four loaves, about three inches wide and an inch high. Bake for 27 to thirty minutes, or until the edges turn light brown.
Slice the loaves into slices, about ¾ of an inch thick. Let them cool on a wire rack.
For the Biscotti Topping: Place the chips and shortening in a small bowl and microwave for ten seconds. Stir. Repeat until the chocolate is melted and smooth. Place the cookies on a wax paper lined pan. Dip the cookies into the chocolate. Then, dip the cookies into the crushed candy canes. Let the chocolate harden before serving.