2. The formula for Depreciation Expense must be able to work under three conditions: \ Normal depreciation expense (Normal) is equal to the book value in the beginning of the period (BVbeg) times the fraction. \ If the BVbeg-Normal produces a negative amount the depreciation expense is equal to BVBeg-Scrap. \ In the last year of an asset's life the depreciation expense is equal to the larger of BVbeg-Scrap and zero.