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Preheat oven to 350°F. Mix milk, sugar, eggs, cinnamon and vanilla in large bowl until well blended.
Stir in bread cubes, apples and cranberries. Spread evenly in 11x7-inch baking dish sprayed with no stick cooking spray.
Bake 40 to 45 minutes or until knife inserted in center comes out clean. Serve warm. Sprinkle with confectioners' sugar before serving, if desired.