01 - Preheat oven to 350°F. Grease and flour two 9-inch round cake pans, lining bottoms with parchment paper.
02 - Whisk together flour, baking powder, and salt in a medium bowl until thoroughly blended.
03 - Beat softened butter and granulated sugar with an electric mixer on medium-high speed for approximately 3 minutes until light and fluffy.
04 - Add eggs one at a time, beating well after each addition. Mix in vanilla extract until fully incorporated.
05 - Alternate adding flour mixture and milk to the butter mixture, beginning and ending with flour. Mix until just combined, being careful not to overmix.
06 - Gently fold rainbow sprinkles into the batter using a spatula, taking care to maintain their color and texture.
07 - Divide batter evenly between prepared pans. Smooth tops and bake for 25-30 minutes until a toothpick inserted in the center comes out clean.
08 - Let layers cool in pans for 10 minutes, then carefully turn out onto wire racks to cool completely before frosting.
09 - Beat butter until creamy. Gradually add powdered sugar, milk, vanilla extract, and salt. Continue beating until frosting is light, fluffy, and spreadable.
10 - Once cake layers are completely cool, frost the top of one layer, place the second layer on top, and cover the entire cake with remaining frosting. Decorate generously with additional sprinkles.