Break-Even Calculator
Break-even is the point where revenue exactly covers costs. Every unit you sell contributes its price minus its variable cost toward the fixed costs; divide fixed costs by that contribution margin and you have the number of units you need.
- Accurate
- Real-time
- Easy to use
- 100% free
Break-even volume
2,000 units
Contribution margin per unit
$25.00
Details
Updates as you typeCosts that do not change with volume: rent, salaries, insurance, software.
Cost incurred for each unit sold: materials, packaging, shipping, card fees.
Summary
Typical — 40% to 60%Break-even volume
2,000 units
Break-even revenue
$120,000
- Fixed costs$50,00042%
- Variable costs at break-even$70,00058%
- Break-even revenue
- $120,000
- Contribution margin per unit
- $25.00
- Contribution margin
- 41.7%
- Units to clear (whole)
- 2,000 units
- Variable cost at break-even
- $70,000
- Break-even assumes price, variable cost, and fixed costs all hold steady across the volume shown.
- Fixed costs divide evenly, so break-even lands on a whole unit.
How this is calculated
- Price per unit
- $60.00
- Variable cost per unit
- $35.00
- Contribution margin per unit
- $25.00
- Fixed costs
- $50,000
- Fixed costs ÷ contribution margin
- 2,000.0 units
- Revenue at break-even
- $120,000
- Profit added by each unit beyond break-even
- $25.00
Compare scenarios
See how one change moves the result
- CurrentYour inputs as they stand2,000 unitsCurrent
- Fixed costs$ 63,0002,520 units
- Price per unit$ 751,250 units
- Variable cost per unit$ 443,125 units
For informational purposes only. This is not financial advice — confirm major decisions with a licensed advisor.
Frequently asked questions
What is the break-even formula?
Break-even units = fixed costs ÷ (price per unit − variable cost per unit). The denominator is the contribution margin: the slice of each sale left over to pay down fixed costs once the variable cost of making that sale is covered.
What counts as a fixed cost versus a variable cost?
Fixed costs stay the same whether you sell one unit or a thousand — rent, salaried staff, insurance, software subscriptions. Variable costs are incurred per sale: materials, packaging, shipping, payment processing fees, and sales commissions.
Why must the price be higher than the variable cost?
If price is at or below variable cost, each additional sale loses money, so no volume ever covers the fixed costs and break-even does not exist. Raise the price or cut the per-unit cost before volume can help you.
How do I find break-even in revenue rather than units?
Divide fixed costs by the contribution margin ratio, which is the contribution margin per unit divided by the price. It gives the same answer as multiplying break-even units by price, and works when you only track totals rather than unit counts.
What happens after I pass break-even?
Fixed costs are already paid at that point, so every further unit adds its full contribution margin straight to operating profit. That is why profit grows faster than revenue once a business clears its break-even volume.