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Break-even calculator

Calculate the units you need to sell to cover fixed and variable costs and reach break-even, plus break-even revenue.

Required fields are marked with an asterisk (*).

Costs that do not change with sales volume (rent, fixed salaries, equipment).
The price you sell each unit at.
The cost of producing each extra unit (materials, variable labour).

The break-even point is the number of units you must sell until revenue covers all costs with neither profit nor loss. This tool computes the units required, the break-even revenue and the contribution margin per unit, assuming linear per-unit costs.

Formula

Break-even units = fixed costs ÷ (price per unit − variable cost per unit). Revenue = break-even units × price per unit.

When is this useful?

Use it before launching a product or service to know how many units you need to sell to cover costs, and to assess the impact of changing the price or cutting costs.

Worked example

Example using the calculator’s values: fixed costs 10,000, price 50, variable cost 30.
Contribution margin 20, break-even units 500, and break-even revenue 25,000.

Assumptions

  • Fixed costs stay constant with sales volume within the studied range.
  • Variable costs are constant per unit (a linear relationship).
  • Every unit sells at the same price, and all units are assumed sold.
  • The price per unit must exceed its variable cost, otherwise there is no break-even point.

Common mistakes

  • Forgetting variable costs and relying on the unit price alone.
  • Using total revenue instead of the per-unit price in the denominator.
  • Setting a price below the variable cost — the calculator blocks it with an error.
  • Assuming the units must always be a whole number; the result can be fractional.

Frequently asked questions

What if I never reach break-even?

You are losing money because revenue does not cover costs. Try raising the price, cutting costs or increasing sales volume, and watch how break-even units change.

Do fixed costs include salaries?

Yes, if they are fixed and do not change with sales. Variable salaries (such as commissions) belong in the variable cost per unit.

Methodology and review

The calculator computes the contribution margin (price per unit minus variable cost) then divides fixed costs by it, assuming a linear relationship between costs and sales volume.

Costs can change at certain volumes in reality, and the result is an estimate within the assumed linear range.

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