Break-Even Analysis Calculator
Find the exact unit sales and revenue required to cover all fixed and variable business costs.
Break-Even Sales Volume
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How to Calculate Break-Even Point
- Enter your total Fixed Costs (Rent, salaries, insurance).
- Enter the Selling Price per individual unit.
- Enter the Variable Cost incurred to produce each unit (Materials, direct labor).
- View the break-even unit sales volume and break-even revenue.
Break-Even Analysis Formula
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Contribution Margin per Unit:
CM = Selling Price - Variable Cost -
Break-Even Units:
BEP (Units) = Fixed Costs / CM -
Break-Even Revenue:
BEP ($) = BEP (Units) × Selling Price
Example
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Monthly fixed costs:
$10,000.
Selling price:$50| Variable cost:$30.Contribution Margin = $20.Break-even = 10,000 / 20 = 500 units ($25,000 revenue).
Common Applications
- Pitching business viability to startup angel investors.
- Setting quarterly sales targets for sales reps.
- Determining whether a new product launch is commercially viable.
Assumptions & Rounding Policy
- Assumes all produced units are sold at steady price.
- Fixed costs remain constant over the operating period.
Frequently Asked Questions
What happens above the break-even point?
Every unit sold above the break-even point contributes its entire unit contribution margin directly to net operating profit.
What if variable cost exceeds selling price?
If variable cost is higher than selling price, each sale produces an outright cash loss, making break-even mathematically impossible.
Notice: Market dynamics, bulk supplier discounting, and seasonal demand fluctuations will affect practical real-world break-even timelines.