Preheat oven to 350 degrees F (180 degrees C). Grease an 8-inch cake pan.
Whisk together the flour, baking powder, and salt. Set aside.
Cream the butter until lighter in color and fluffy. Add the sugar and cream until well-incorporated and light. Add the egg yolks, one at a time, and beat gently to incorporate each one. Add the vanilla and stir until incorporated.
Alternate adding the milk and dry ingredients, about 1/4 cup at a time, until all ingredients are added. Stir until just incorporated, do not over mix. If using sprinkles to make funfetti cake, add them to the batter and stir until just incorporated. Do not over stir or the sprinkles will bleed their color.
Pour batter into the greased cake pan. Bake for 20-25 minutes or until slightly golden and cake bounces back when pushed.
Let cake cook in the pan on a wire rack for about 15 minutes. Invert pan and turn cake onto the wire rack and let cool until completely cool.
When the cake is ready, lay parchment paper on a flat surface. Transfer cake to paper. Grease the rim of a drinking glass or cookie cutter with about a three inch diameter. Press the glass slowly and gently into the cake on the edge. Tap and shake the glass gently to pop the cake out. Repeat until you’ve gotten as many circles as possible (you should be able to get at least four). To create extra circles, cut out half circles from large enough spots on the edge of the cake and seal them together with frosting.
Stack the mini cakes with a layer of frosting between each. I recommend not going higher than three layers. You may want to press the outside of the cakes together a bit to seal in the crumbs at this point. Frost the outside of the cake and decorate as you please!