Preheat oven to 350 degrees F. Grease an 8×8 inch baking pan and line with parchment paper, leaving overhang on all sides.

Whisk together flour, baking powder, and salt in a medium bowl and set aside.

Beat room-temperature butter and granulated sugar together on medium-high speed for 3 minutes until pale and fluffy.

Add eggs one at a time, beating well after each. Mix in vanilla extract and sour cream until just combined.

Alternate adding the flour mixture and milk to the butter mixture in 3 flour additions and 2 milk additions, starting and ending with flour. Mix on low speed just until combined. Do not overmix.

Pour batter into the prepared pan, smooth the top, and bake for 22 to 26 minutes until a toothpick inserted in the center comes out with just a few moist crumbs. Cool completely in the pan on a wire rack.

Beat room-temperature butter on medium-high for 2 to 3 minutes until pale and creamy. Add sifted powdered sugar one cup at a time on low speed. Add vanilla extract and 2 tablespoons of heavy cream. Beat on high for 3 minutes until light and fluffy. Add more cream one teaspoon at a time if needed.

Use a round cookie cutter or the rim of your serving cup to cut circles of cake that fit snugly inside each cup.

Place a cake circle in the bottom of each cup. Spread a generous, dome-shaped layer of buttercream over the top of the cake, mounding it slightly above the cup rim.

Pour nonpareils onto a flat plate. Flip each frosted cup upside down and press the buttercream dome firmly into the nonpareils. Rotate slightly for full coverage. Flip right-side up.

Refrigerate assembled dot cakes for at least 30 minutes before serving so the buttercream sets and the sprinkles adhere.