Green’s Dictionary of Slang

1. (US) anything simple, ridiculously easy.

1899		Ade Fables in Sl. (1902) 28: The Easy One to Third that ought to have been Sponge Cake was fielded like a One-Legged man with St. Vitus dance trying to do the Nashville Salute.
1947		D. Davin For the Rest of Our Lives 246: And Rommel’s no sponge cake. There’s trouble coming.

2. (N.Z. prison) a white person.

2001

D. Looser Boobslang [U. Canterbury D.Phil. thesis] 174/1: sponge cake n. a European person.