In a medium mixing bowl beat margarine and sugar until blended. Beat in egg, milk, and vanilla. Stir in carrot.
In another bowl combine flour, baking powder, cinnamon, salt, and nutmeg. Add to carrot mixture and stir until blended.
Spray an 8x8x2-inch baking pan with nonstick spray coating. Pour batter evenly into pan.
Bake in a 350 degrees F oven for 20 to 25 minutes or until a toothpick inserted near the center of the cake comes out clean. Cool on wire rack. (If desired, remove from pan after cooling 10 minutes. Then, cool completely.
Place a paper doily on top of the cake. Lightly sift the powdered sugar evenly over the doily. Then, carefully remove the doily. Makes 9 servings.