Mix together in large bowl and set aside:

2 cups flour          

2 cups sugar                  

1 teaspoon soda

In saucepan, bring to boil:

2 sticks margarine           

4 tablespoons cocoa

1 cup water

Mix together with flour mixture in bowl. 

Add: 

1/2 cup sour milk            

2 eggs         

1 teaspoon vanilla

Mix well and pour into pan and bake in 400 degree oven for 20 minutes.

FROSTING:

Mix and bring to a boil:

1 stick margarine            

2 tablespoons cocoa

7 tablespoons canned milk

ADD:

1 box powered sugar                                   

1 teaspoon vanilla

1/2 cup walnuts

Start this about 5 minutes before cake is done.  Put on cake while it is still hot, right out of the oven.