Break-Even Calculator

Calculate break-even volume and revenue from fixed and variable costs.

About Break-Even Calculator

Break-even depends on contribution margin rather than gross margin, since only the variable cost scales with volume. A negative contribution margin means no volume can reach break-even. The margin of safety matters more than the break-even point itself, because it measures how much demand can fall before the business loses money.

Formula

Break-Even

Break-even units = fixed costs ÷ (price − variable cost per unit)

contribution margin: What each unit contributes towards fixed costs
margin of safety: How far volume can fall before reaching break-even

Worked example

With the default values below, Break-Even Calculator returns Break-Even Volume of 625.0. Change any input above and every figure here is recalculated in your browser.

Inputs used

Monthly fixed costsminimum 0: 45,000
Price per unitminimum 0.01: 120
Variable cost per unitminimum 0: 48
Current monthly volumeminimum 0: 500

Results

Break-Even Volume: 625.0 units
Contribution Margin per Unit: $72.00
Break-Even Revenue: $75,000.00
Contribution Margin: 60.00%
Margin of Safety: -25.00%

Step by step

1Values used
2Break-Even
3Break-Even Volume= 625.0 units
4Contribution Margin per Unit= 72.00
5Break-Even Revenue= 75,000.00
6Contribution Margin= 60.00
7Margin of Safety= -25.00

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation, tax or compounding frequency into account.
Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

How is Break-Even calculated?

Break-even units = fixed costs ÷ (price − variable cost per unit) Break-even depends on contribution margin rather than gross margin, since only the variable cost scales with volume. A negative contribution margin means no volume can reach break-even.

Why does Break-Even matter?

The margin of safety matters more than the break-even point itself, because it measures how much demand can fall before the business loses money.

What values do I need to enter?

This calculator takes 4 inputs: Monthly fixed costs, Price per unit, Variable cost per unit, Current monthly volume. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.