Preheat the oven to 350°F. Line the bottom and sides of an 8-inch round pan with parchment paper and set aside.
In a bowl, beat the egg whites using a mixer at low speed for 2 to 3 minutes or until soft peaks form.
Gradually add ¼ cup of the granulated sugar, a tablespoon at a time, while continuously beating. Once all sugar is added, turn up the speed to medium and continue beating the meringue until it forms stiff glossy peaks. Set aside.
In a separate bowl, cream the butter and remaining ¼ cup sugar for 3 minutes or until light in color.
Add the yolks one at a time while continuously mixing for about 2 minutes.
Add milk, cake flour, baking powder, and vanilla extract to the egg yolk mixture. Beat until batter for about 2 minutes or until smooth.
Gently fold in a third of the meringue into the egg yolk mixture and then add the remaining meringue and fold until well combined.
Pour into prepared pan and bake for 30 minutes in the preheated oven or until a toothpick inserted in the center comes out clean.
Remove from oven and let the cake cool in the pan for about 10 minutes before completely removing from pan to a cooling rack. Remove the parchment paper off the cake and let it cool down before frosting.