Here is a shortcut on your hunt for ready-to-use 1/4" homasote roadbed:
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Normally, homasote is only available in 1/2" thuck 4' x 8' sheets. The California Roadbed company (who make the 1/4" thick homasote roadbed) deal with the mess and hassle of cutting and machining it for use a model railroad roadbed. You really don't want to do this yourself!
Except for yards, you will be using narrow (about 2" wide for H0) beveled strips just under the tracks. Railroad tracks are commonly raised a bit about the surrounding area with balast. The homabed roadbed simulates most of this balast and the actual fine ground stones between the ties adds to the last bit. You will probably putting in scenery mix and whatnot on the bare foam (I assume you are not modeling a scene with flat blue ground (and what planet would that be on?)).