1. * Use an 8-ounce can of sauerkraut.

2. Do not use sauerkraut which has caraway seeds.

3. Lightly drain and chop by hand -- don't use food processor.

4. 1. Combine margarine and sugar in large bowl.

5. Beat in eggs one at a time.

6. Add the vanilla and blend.

7. 2. In another bowl, sift dry ingredients together.

8. Add to the egg mixture slowly, alternating with the water.

9. Stir in the sauerkraut.

10. Mix until smooth.

11. 3. Grease a 13 x 9 x 2-inch pan. Pour the cake batter into pan and bake in preheated 350-degree oven for 30-35 minutes, or until knife inserted in center comes out clean.

12. If you prefer, leave the cake in the pan for easier frosting and transporting.

13. FROSTING: 1. Melt chocolate chips and margarine in top of double boiler.

14. Remove from heat and add sour cream, vanilla and salt.

15. Gradually beat in powdered sugar until the frosting is of spreading consistency.

16. You may not need all the powdered sugar.

17. 2. Frost cake while still slightly warm or wait until cooled.