Break-Even Calculator

Knowing your break-even point tells you how many units you need to sell before your business turns a profit. Enter your fixed costs, price per unit, and variable cost per unit to see the numbers instantly.

Estimates only — not professional financial advice.

Fixed Costs ($)

Total fixed costs like rent, salaries, insurance

Price per Unit ($)

What you charge customers for one unit

Variable Cost per Unit ($)

Cost to produce one unit (materials, labor)

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Track costs and sales easily with small-business accounting software. See recommendations. Estimates only, not financial advice. Some links are affiliate links.

How it works

The break-even point is where total revenue equals total costs, so profit is zero. The key figure is the contribution margin per unit, which equals price per unit minus variable cost per unit.

Break-even units = Fixed Costs ÷ Contribution Margin per Unit. Multiply that by the price per unit to get the break-even sales in dollars. Selling above the break-even point produces profit; below it produces a loss.

Tips

Lowering fixed costs or raising your contribution margin (by increasing price or cutting variable costs) reduces the number of units you need to break even.

Use realistic numbers and revisit them often — costs and prices change. Round break-even units up, since you can't sell a fraction of a unit to cover costs.

FAQ

What is the break-even point?

It's the level of sales where your total revenue exactly covers your total fixed and variable costs, leaving zero profit and zero loss. Beyond it, you start making money.

What is contribution margin?

Contribution margin per unit is the price per unit minus the variable cost per unit. It's the amount each sale 'contributes' toward covering your fixed costs and then profit.

Why must price be higher than variable cost?

If the price equals or is below the variable cost, each sale loses money and you can never cover fixed costs — there is no break-even point at any volume.