Alexander,
If I'm not totally mistaken, then you are referring to the formula for the double declining balance on page 6 at the top. The formula is correct.
If you have an asset that costs $120,000 and has a useful life of 5 years, then the depreciation rate for the double declining balance is calculated as follows:
Depreciation Rate = 2 * (100% / Useful Life)
Depreciation Rate = 2 * (100% / 5)
Depreciation Rate = 2 * (20%)
Depreciation Rate = 40%
And yes... your yearly depreciation is really 40% of the book value at the beginning of the year. It sounds high but makes sense when you think about it logically: That way you depreciate a higher value in the early life of your asset, which is usually where the depreciation is highest anyway. (Like when you drive your new car out of the dealer lot you are "losing" about 30% value at that very moment...
So using 100 in the formula is correct. 1 would be wrong.
In any case, take a look at the excellent description of this on Wikipedia. The tables they show make it really come alive:
en.wikipedia.org/wiki/Depreciation