Find the break-even point in units and in revenue from your fixed costs, variable cost per unit and selling price — with contribution margin explained in plain terms. Runs entirely in your browser — your numbers never leave this device.
| Of break-even volume | Units sold | Profit |
|---|---|---|
| 50% | 250 | $-5,000.00 |
| 80% | 400 | $-2,000.00 |
| 100% | 500 | $0.00 |
| 125% | 625 | $2,500.00 |
| 150% | 750 | $5,000.00 |
| 200% | 1,000 | $10,000.00 |
Break-even is the sales level at which total revenue exactly covers total costs — no profit, no loss. Costs split into two kinds: fixed costs (rent, salaries, insurance) that are owed whether you sell one unit or a thousand, and variable costs (materials, packaging, transaction fees) that are incurred once per unit sold. Each sale contributes its price minus its variable cost toward paying off the fixed costs; that difference is the contribution margin, and it is the engine of the whole calculation.
Dividing the fixed costs by the contribution margin per unit gives the break-even quantity directly; multiplying back by the price gives the break-even revenue. Every unit sold beyond that point contributes its full margin as profit, which is why the same two numbers also answer 'what is one more sale worth?' The calculator reports units (rounded up, because a fraction of a unit cannot be sold) and lets you test price, variable cost and fixed cost changes against the same baseline.
One case has no answer and the calculator states it in words: if the price per unit is less than or equal to the variable cost per unit, the contribution margin is zero or negative, every sale loses money or adds nothing, and no sales volume can ever cover the fixed costs. More sales cannot fix a negative margin — only a higher price or a lower variable cost can.
The amount each sale contributes toward covering fixed costs (and then toward profit): price per unit minus variable cost per unit. In the first example it is $50 − $30 = $20, so each of the first 500 sales contributes $20 until the $10,000 of fixed costs is covered, and each sale after that contributes $20 of profit.
Round up. If the division gives 333.33 units, selling 333 units leaves a small loss and the 334th unit takes you past break-even — a fraction of a unit cannot be sold. The calculator rounds the unit figure up and bases the revenue figure on the rounded units, so the reported point is the first quantity that is genuinely not losing money.
Only if you include them in fixed costs, which is usually the sensible approach: add any regular payment that must be made regardless of sales — salary, rent, loan repayments, subscriptions — to the fixed-cost figure. The formula does not care what the fixed costs are, only their total. Omitting a real fixed cost makes the break-even point falsely low.
It lowers it, through the margin. Raising the first example's price from $50 to $60 lifts the margin from $20 to $30, so break-even falls from 500 units to 10,000 / 30 = 334 units (rounded up). Whether the higher price reduces the number of units customers actually buy is a market question outside the formula — the calculator shows the arithmetic side of the trade-off.
Yes. Break-even is about profit over a period, not timing: costs may be due before the matching revenue arrives, stock must be bought before it is sold, and customers may pay late. A business can be above break-even on paper and still face a cash gap, which is why break-even analysis is a pricing and volume tool, not a cash-flow forecast.
More in Finance Calculators · Browse all tools