How to Make It
Preheat oven to 350°F. Grease and flour 2 (8-inch) round cake pans; set aside.
Combine cake mix, water, oil, and eggs in a large bowl. Beat with an electric mixer on low speed until combined, about 1 minute. Divide batter evenly between prepared pans. Bake in preheated oven until a wooden pick inserted in center comes out clean, 20 to 22 minutes.
Cool cakes in pans on a wire rack 15 minutes. Remove cakes from pans, and cool completely on rack, about 30 minutes.
Combine frosting and powdered sugar in a large bowl. Beat with an electric mixer on medium speed until combined and smooth, about 2 minutes. Place 1/4 cup of the frosting mixture in a small bowl, and place 1/2 cup of the frosting mixture in a separate small bowl. Add yellow food coloring to 1/4 cup frosting mixture, and add purple food coloring to 1/2 cup frosting mixture to create deep purple frosting. Color remaining frosting deep black.
Cut 2 diagonal lines in 1 cake to create a triangle shape. Cut a very thin arc from edge of second cake. Place cake triangle on top of second cake, and trace with knife to remove triangle portion from circular cake. Fit triangle cake into second cake to create a hat shape. Reserve remaining cake for another use. Place black frosting in a piping bag, and pipe over hat cake; smooth with a knife. Place purple frosting in a second piping bag; pipe a band around hat, and smooth with a knife. Sprinkle purple sparkling sugar over hat band. Place yellow frosting in third piping bag; pipe a clasp on band of hat.