I've seen this all over all the cool math kids' sites and I wanted to get in on it!
At my last school I had a set of small dry erase boards and I used them all the time. I saw the shower board dry erase board ideas all over the place so I decided to check it out. $15 for that much whiteboard seems too good to be true.
I ended up getting the board from Lowe's and found two different options. They have a smaller more expensive one called Mark-r-board and bigger one that's 4' x 8' called tile board. After comparing the two side by side for like 10 minutes I couldn't find any difference and bought the larger one.
They even cut the board for free which is awesome. I tried to talk the guy into cutting it all down into the little sizes I needed and although he was super nice he laughed and said the machine was just too big. What we decided on instead was the following cuts (in blue):
I came home with 8 of these:
At home I used a saw to cut each of the long strips at 9" increments (dotted lines).
It got me five 9" x 12" boards and a little leftover from each strip. In hindsight, I probably should have done 9.6" and had none left over but oh well.
The left side has no dotted lines because I actually din't cut those yet. I'm going to wait and see how many kids I have and then cut more if necessary. I definitely won't need 40 though so I'm looking forward to figuring out what to use the rest for.
Once they were all cut the edges weren't very nice looking so I just took sandpaper and sanded them down which was easy and made them all look nice and finished.
Update (7/14/14): I wanted to add a short update on these here after having them around for over a year now. Unfortunately I don't love them. So many people have said they work great but regardless of what type of marker I use they just don't erase that well. I even went back and bought the smaller slightly more expensive one that's actually called "Mark-r-board" thinking it would erase better but nope. I had that one cut into large sheets for group work and used them maybe twice before it just wasn't worth it.