Break-Even Calculator
About the Break-Even Calculator
Find the break-even point: the number of units you need to sell to cover all fixed and variable costs. Enter the fixed costs, the variable cost per unit and the selling price per unit.
How it is calculated
Break-even units = fixed costs ÷ (price per unit − variable cost per unit)
Each unit sold contributes its price minus its variable cost (the contribution margin) to cover the fixed costs. Once enough units are sold to cover them, every additional unit is profit. The calculator rounds the units up, because you cannot sell part of a unit.
Example
With fixed costs of 10,000, a variable cost of 6 and a price of 10 per unit, each unit contributes 4, so you need to sell 10,000 ÷ 4 = 2,500 units to break even.
Frequently asked questions
What are fixed and variable costs?
Fixed costs such as rent or salaries stay the same whatever you sell; variable costs such as materials grow with every unit produced.
What if the price is below the variable cost?
Then each sale increases the loss and there is no break-even point; the price must be higher than the variable cost.
How do I calculate break-even revenue?
Multiply the break-even units by the selling price.