Gather all ingredients. Preheat the oven to 350 degrees F (175 degrees C). Grease a 9x13-inch baking dish.
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To make the cola cake: Combine flour and sugar in a mixing bowl. Place butter, cola soft drink, and cocoa in a saucepan over medium heat; bring to a boil. Pour over flour mixture; mix well.
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Stir in marshmallows, buttermilk, eggs, baking soda, and vanilla until well combined; pour cake batter into prepared dish.
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Bake cake in the preheated oven until a toothpick inserted in the center comes out clean, about 40 minutes.
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To make the cola frosting: Combine butter, cola soft drink, and cocoa in a saucepan; bring to a boil. Pour over confectioners' sugar in a large bowl; mix well. Stir in chopped nuts.
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Spread cola frosting over hot cake.
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