Break-even Point
Local ProcessingCalculate break-even unit sales volume Q = Fixed Costs / (Unit Price - Unit Variable Cost).
How It Works & Processing Standards
Enter values above to calculate results automatically. Check each input field for guidance and units.
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Finds the point where profit is zero. Choose units (how many to sell) or sales (how much revenue) under "Calculation".
What You Can Do
- Break-even units
- fixed costs ÷ (unit price − unit variable cost)
- Break-even sales
- fixed costs ÷ contribution margin ratio
How to Use Break-even Point
- 1Choose a calculationUnits for a number of items, sales for a revenue figure.
- 2Enter costsFixed costs such as rent and wages, and variable costs such as materials per item.
- 3Read the resultSell more than this to make a profit.
Examples
Fixed 3,000,000, price 15,000, variable 9,000
Input: Fixed 3,000,000, price 15,000, variable 9,000
Result: 500
Fixed 3,000,000, 40% contribution margin
Input: Fixed 3,000,000, margin 40%
Result: 7,500,000
Common Use Cases
- How many items a new business must sell each month
- Comparing a price rise against a cost cut
- Explaining the profit structure in a business plan
Frequently Asked Questions (FAQ)
What if the price is below the variable cost?
Every sale loses money, so there is no break-even point and you are told so.
How do I get the contribution margin ratio?
(price − unit variable cost) ÷ price × 100. Selling at 15,000 with 9,000 variable cost gives 40%.