01 - Preheat oven to 350°F. Grease and flour two 9-inch round cake pans and line bottoms with parchment paper.
02 - Whisk together flour, baking powder, and salt in a medium bowl.
03 - Beat butter and sugar with electric mixer until light and fluffy, approximately 3 minutes.
04 - Add eggs one at a time, beating well after each addition. Stir in vanilla extract.
05 - Alternately add flour mixture and milk to butter mixture, beginning and ending with flour. Mix until just combined.
06 - Gently fold rainbow sprinkles with spatula, taking care not to overmix.
07 - Divide batter evenly between prepared pans. Smooth tops and bake for 25-30 minutes, until toothpick inserted in center comes out clean.
08 - Cool layers in pans for 10 minutes, then turn out onto wire racks to cool completely.
09 - Beat butter until creamy. Gradually add powdered sugar, milk, vanilla, and salt. Beat until light, fluffy, and spreadable.
10 - Frost top of one cooled layer, place second layer on top, and cover entire cake with remaining frosting. Decorate with extra sprinkles.