Break-even Calculator
Determine break-even units and revenue from fixed and variable costs.
Overhead expenses such as rent, software, payroll, and insurance
Average revenue generated per product or service unit
Direct production cost: materials, labor, shipping, card fees
Leave at $0 to find baseline break-even
You must sell 334 units ($16,700.00 in revenue) to break even.
How It Works
The Break-even Calculator identifies the exact sales volume needed to cover all fixed and variable operating costs, yielding zero profit and zero loss.
It also calculates contribution margin per unit and determines how many additional units must be sold to achieve a specific target profit goal.
Formula & Calculation
Break-even Volume Formula
Price per unit must strictly exceed variable cost per unit; otherwise, every unit sold generates a loss and break-even is mathematically impossible.
Step-by-Step Example
Example: Manufacturing a Widget
Find the break-even point with $10,000 fixed costs, $50 selling price, and $20 variable cost:
$50.00 − $20.00→ $30.00 contribution/unit$10,000 / $30.00→ 333.33 unitsceil(333.33)→ 334 units334 units × $50.00→ $16,700.00The business must sell 334 units ($16,700 in revenue) to cover all operating costs.
Assumptions & Edge Cases
- Contribution Margin Must Be Positive: If the selling price is less than or equal to variable cost per unit, the contribution margin is zero or negative, making cost recovery impossible. The calculator rejects this condition with an inline alert.
- Discrete Unit Ceilings: In practical business operations, fractional units cannot be sold. Break-even volume is rounded up to the nearest whole integer unit.
Frequently Asked Questions
What expenses count as fixed costs versus variable costs?
Fixed costs remain constant regardless of production volume (office rent, insurance, administrative salaries). Variable costs scale directly with output (raw materials, packaging, direct assembly labor, payment processing fees).