Watch the video.

You can see these how tos in video form here:
http://www.myspace.com/cheapchampagneoner

You'll need a 16 oz bag of mini marshmallows, 2-5 tablespoons water, and a 2 lb bag of powdered sugar.

add the water to the marshmallows and microwave for 2 minutes.

stir until you have no lumps.

introduce the entire bag of sugar into the marshmallow mixture. Knead until you have a play dough like blob. refrigerate for 15 minutes to firm.

take small portions and color them with food coloring.

roll your fondant till it's 1/4 of an inch thick and and long and as wide as your cakes chosen dimensions. apply to your cake. Make sure you have a layer of buttercream between the fondant and your cake.