Break-Even Calculator
Find how many units you need to sell to cover fixed and variable costs. Includes contribution margin, target profit, and margin of safety.
Break-even details
Break-even
333 units
Revenue at break-even: $16,666.67
- Contribution margin per unit
- $30.00
- Contribution margin ratio
- 60.00%
- Target revenue
- $25,000.00
- Target profit / loss
- $5,000.00
- Margin of safety (units)
- 167
- Margin of safety %
- 33.33%
Frequently Asked Questions about the Break-Even Calculator
What is the break-even point?
The break-even point is the number of units you must sell so that total revenue equals total costs. Below it you lose money; above it you start to earn profit. The formula is fixed costs divided by contribution margin per unit.
What is contribution margin?
Contribution margin per unit is selling price minus variable cost per unit. It is the amount each unit contributes toward covering fixed costs once variable costs are paid.
Why does the calculator require price > variable cost?
If the price does not cover variable cost, every additional unit loses more money, and there is no level of sales that breaks even. The calculator returns no result in that case so you do not act on a misleading number.
What is margin of safety?
Margin of safety is how far above break-even your target sales sit, in units and as a percentage. A higher number means more room before you slip into losses. It is a useful sensitivity check for budgeting.
Should I use break-even for pricing decisions?
Break-even is a sanity check, not a pricing strategy. It tells you the minimum volume you need at a given price, but market demand, competition, and value perception drive what customers will actually pay.