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 butter and sugar with electric mixer on medium-high speed until light and fluffy, approximately 3 minutes.
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 butter mixture, starting and ending with flour. Mix until just combined, being careful not to overmix.
06 - Gently fold rainbow sprinkles into batter using spatula. Distribute evenly throughout mixture.
07 - Divide batter evenly between prepared pans. Smooth tops with offset spatula for even baking.
08 - Bake for 25-30 minutes or until toothpick inserted in center comes out clean. Layers should be golden brown and spring back when touched.
09 - Let layers cool in pans for 10 minutes. Turn out onto wire racks and cool completely before frosting, about 1 hour.
10 - Beat butter until creamy. Gradually add powdered sugar, milk, vanilla, and salt. Continue beating until light, fluffy, and spreadable consistency is achieved.
11 - Once layers are completely cool, spread frosting on top of one layer. Place second layer on top and cover entire cake with remaining frosting. Decorate with additional sprinkles as desired.