Break-Even Point Calculator
Find the units and revenue needed to cover fixed costs given price and variable cost per unit.
What this calculates
Break-even is where revenue covers all costs — profit zero. Below it you lose money; above it every additional unit feeds margin. The calculation is simple but powerful for pricing, hiring, and go/no-go decisions on new products.
Formula & how it works
Break-even units = Fixed costs ÷ (Price − Variable cost per unit). Break-even revenue = units × price. Contribution margin = (Price − Variable cost) ÷ Price.
Worked example
Fixed costs $40,000. Price $25, variable cost $10. Contribution margin = $15. Break-even = 40,000 ÷ 15 = 2,667 units = $66,675 revenue.
Frequently asked questions
What are fixed costs?
Costs that don't change with volume: rent, salaries, insurance, software subscriptions, debt service.
Variable costs?
Costs that scale per unit: raw materials, shipping, payment processing fees, sales commissions.
What if margin is negative?
Price is below variable cost — every sale loses money. Raise price or cut variable cost before worrying about fixed costs.