Break-Even Calculator

Enter your fixed costs, selling price per unit and variable cost per unit to find the break-even point — the sales volume where total revenue exactly covers total costs — plus your contribution margin and profit at any volume.

Enter your costs and price, then press Calculate break-even.

The break-even formula

The break-even point is the sales volume at which total revenue exactly equals total costs — no profit, no loss. The key idea is the contribution margin: the part of each sale left over after variable costs, which goes toward covering fixed costs.

break-even units = fixed costs ÷ (price − variable cost)

Once enough units are sold to cover all fixed costs, every additional unit's contribution margin becomes profit. Multiply break-even units by price to get the break-even revenue in dollars.

Worked example

Fixed costs $12,000, price $40, variable cost $25:

Contribution margin: $40 − $25 = $15 per unit.
Break-even units: $12,000 ÷ $15 = 800 units.
Break-even revenue: 800 × $40 = $32,000.

Contribution margin and profit

The contribution margin ratio (margin ÷ price) tells you what fraction of each sales dollar helps cover fixed costs and then becomes profit — here $15 ÷ $40 = 37.5%. Enter your expected units sold and the calculator shows the profit or loss at that volume and how far above or below break-even you are (the margin of safety). If your price is at or below variable cost, the contribution margin is zero or negative and you can never break even — a clear signal to raise price or cut variable costs.

Tip: setting price from a target margin? Use the markup calculator or check your profit margin.

Frequently asked questions

What is the break-even point?

It's the level of sales where total revenue equals total costs, so profit is exactly zero. Below it you lose money; above it you make money. It tells you the minimum you must sell just to cover all costs.

What is contribution margin?

Contribution margin is price minus variable cost per unit — the money each sale contributes toward fixed costs and then profit. The contribution margin ratio expresses that as a percentage of the selling price.

What if price is below variable cost?

Then every unit loses money before fixed costs are even considered, so there's no break-even point. You must raise the price or lower the variable cost per unit before the business can become profitable.

What is the margin of safety?

It's how far your actual or expected sales are above the break-even point, in units or revenue. A larger margin of safety means more cushion before you'd start losing money if sales dip.

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Mustafa Bilgic · Editor, Calcool
Uses the standard break-even formula (fixed costs ÷ contribution margin) and contribution-margin analysis from managerial accounting. Everything runs in your browser — nothing you enter is uploaded, logged or stored.

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