In a bowl, combine the milk, soy sauce, bread cubes, garlic salt and onion powder. Crumble beef and sausage over mixture and mix well. Stir in water chestnuts. Shape into 1-in. balls.
Line a 15-in. x 10-in. x 1-in. baking pan with foil; place meatballs in pan. Broil 4-6 in. from the heat for 10 minutes or until a thermometer reads 160°; drain.
In a large skillet, combine the sauce ingredients. Bring to a boil. Reduce heat; simmer, uncovered, until thickened.
Add meatballs; cook and stir until heated through.