Break-even Calculator
Calculate the break-even sales volume, revenue threshold, and unit contribution margin for business planning.
Contribution margin: 50.00 price − 30.00 variable = 20.00/unit
Break-even units: 10,000.00 fixed costs ÷ 20.00 margin = 500 units
Break-even revenue: 500 units × 50.00 = 25,000.00
Use any currency — results use the same currency as your inputs. Break-even units are rounded up to the next whole sellable unit.
Determine the exact number of units and sales revenue your business needs to cover all fixed and variable expenses before generating a profit.
Formulas & Methodology
- Contribution Margin per Unit:
Selling Price per Unit - Variable Cost per Unit - Contribution Margin Ratio:
(Contribution Margin per Unit ÷ Selling Price per Unit) × 100 - Break-Even Units:
Total Fixed Costs ÷ Contribution Margin per Unit(rounded up to next whole unit) - Break-Even Revenue:
Break-Even Units × Selling Price per Unit
Worked Acceptance Example
For a business with:
- Fixed Costs: 10,000
- Selling Price per Unit: 50
- Variable Cost per Unit: 30
The calculations are:
- Contribution Margin per Unit:
50 - 30 = 20.00 - Contribution Margin Ratio:
(20 ÷ 50) × 100 = 40.00% - Break-Even Units:
10,000 ÷ 20 = 500 units - Break-Even Revenue:
500 × 50 = 25,000.00
Frequently Asked Questions
How do you calculate the break-even point in units?+
The break-even point in units is calculated by dividing total fixed costs by the contribution margin per unit (Selling Price per Unit − Variable Cost per Unit). The result is rounded up to the nearest whole sellable unit.
What is the contribution margin and why does it matter?+
Contribution margin is the revenue remaining from each unit sold after covering its variable production costs. It represents the portion of sales revenue available to pay off fixed operating costs and generate business profit.
How is break-even revenue calculated?+
Break-even revenue equals the break-even unit sales volume multiplied by the selling price per unit. It indicates the total gross sales income required to cover all fixed and variable expenses.
Why are break-even units rounded up?+
Physical products and most services must be sold in whole units. Rounding up to the next integer ensures that your business covers all fixed costs rather than falling slightly short.