CalcGrove

Break-Even Calculator

Find out how many units you need to sell to cover your fixed and variable costs and start making profit.

$

Rent, salaries, insurance, etc.

$
$

Materials, shipping, etc. per unit

Break-Even Point

167 units

Break-Even Revenue

$8,350.00

Contribution Margin

$30.00/unit

Contribution Margin %

60.0%

How to Use This Calculator

  • 1.Enter your total fixed costs (expenses that stay the same regardless of sales volume).
  • 2.Enter the selling price per unit.
  • 3.Enter the variable cost per unit (costs that increase with each unit sold).

The Formula

Break-Even Units = Fixed Costs / (Price Per Unit - Variable Cost Per Unit)

Contribution Margin = Price - Variable Cost

Example Calculation

A coffee shop with $5,000/month in fixed costs sells lattes at $5 each with $2 in variable costs:

  • Contribution margin: $5 - $2 = $3 per latte
  • Break-even: $5,000 / $3 = 1,667 lattes per month
  • That's about 56 lattes per day (assuming 30 days)

Why This Matters

Knowing your break-even point tells you the minimum sales volume needed to avoid losses. It's essential for pricing decisions, setting sales targets, and evaluating whether a new product or business idea is financially viable.

Manage your business finances

Track expenses, create invoices, and monitor your break-even point in real time with professional accounting software.

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Frequently Asked Questions

What are fixed costs?

Fixed costs don't change with sales volume: rent, salaries, insurance, loan payments. You pay them whether you sell 0 units or 10,000.

What are variable costs?

Variable costs increase with each unit sold: raw materials, packaging, shipping, sales commissions. The more you sell, the higher they go.

How can I lower my break-even point?

Three ways: reduce fixed costs, increase your selling price, or reduce variable costs per unit. Even small improvements in any area compound over time.

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