Break-Even Calculator
Break-even analysis explained
Break-even is the sales volume at which total contribution margin covers fixed costs. Enter fixed costs for one consistent period and per-unit price and variable cost for the same product.
Formula and method
Break-even units = fixed costs ÷ (price per unit − variable cost per unit). Break-even revenue = break-even units × price.
Worked example
$5,000 in fixed costs with a $50 price and $25 variable cost requires 200 units, or $10,000 in revenue, to break even.
How to interpret the result
The key number is contribution margin: selling price minus variable cost per unit. Each sale contributes that amount toward fixed costs. Because businesses normally cannot sell a fraction of a unit, round the calculated break-even quantity up to the next whole unit when setting a minimum sales target.
Important limitations
- Price must be greater than variable cost.
- Mixed products and step-fixed costs require a more detailed model.
Common questions
What belongs in fixed costs?
Include costs that do not change with unit volume for the selected period, such as rent or a base software subscription. Use the same monthly or annual period for every input.
What if I sell several products?
A single-product formula is not enough unless the sales mix and weighted contribution margin are stable. Changes in product mix can move the true break-even point.
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Method and examples reviewed September 8, 2026.