I got a couple sheets from
The Foam Factory for not too much money. I was redoing the case I keep my telescope accessories in. I used the firm charcoal foam because I wanted to do custom cutouts and pack everything as closely as possible to fit more items in the case. The regular charcoal foam is the stuff you find in most cases. They also have the pick-n-pluck version of the regular firmness. I bought a half sheet of the 1/2" and 1-1/2" so I could redo my cases a couple times if needed. I've just berely started nibbling at the edge of the sheet. I use the 1/2" as the base/cushioning between layers. Then I do the actual cutouts in the 1-1/2" to hold items.
To cut the foam, I also bought a crafter's hot knife from
Hotwire Foam Factory. It was a little disappointing because it was a little too flexible and was too slow since it didn't heat up enough. If I were to do it again, I would spend the extra money on the pro scroll saw kit with an adjustable power supply and wire supported at both ends. But I actually did most of my work using those long razor blades used as refills for the
utility knife with the snap off tips. I just recently bought
this hot knife from Harbor Freight for $15. I haven't had a chance to use it yet, so I can't report on how well it works on the foam. But it obviously won't be suitable for detail work.