Break-Even Calculator

About this calculator

A free break-even calculator built on contribution margin — what each sale leaves behind after its own variable cost to chip away at fixed costs. The default view solves break-even in whole units from fixed costs, price, and variable cost per unit; a sales-dollars view solves break-even revenue from a blended contribution margin ratio when there is no single "unit"; and a target-profit view extends the formula to the volume that clears a profit goal on top of the bills. Everything is computed in your browser on the numbers you enter, and nothing is uploaded or stored. Treat the result as a planning estimate for sizing a price, a budget, or a sales target — not business, tax, or accounting advice.

Contribution margin is the number doing the work

Every break-even formula is built on one quantity: contribution margin, the selling price minus the variable cost of one unit. Sell at $50 with $30 of variable cost and each sale contributes $20 — 40% of the price — first toward fixed costs, then, once those are covered, toward profit. Break-even is simply the volume at which the accumulated contributions equal the fixed costs.

The arithmetic is the easy part; classifying costs is the hard part. Rent, insurance, and salaried payroll are fixed — they arrive whether you sell or not. Materials, packaging, payment processing, and per-order shipping are variable — they scale with each unit. But many real costs sit in between: hourly labor flexes with volume in steps, utilities have a base charge plus usage, and marketing can be either a budget or a per-acquisition cost. A defensible break-even number depends more on sorting those honestly than on the division at the end, so when a cost is genuinely mixed, split it rather than dumping it whole into either bucket.

The units formula, walked through

Break-even units = fixed costs ÷ contribution margin per unit. With $10,000 of fixed costs and a $20 margin, that is 10,000 ÷ 20 = 500 units, which at $50 each is $25,000 of break-even revenue. Sell unit 501 and you are past break-even; everything that unit contributes is profit.

The division rarely lands on a whole number. Take $12,500 in fixed costs at a $45 price with $18 of variable cost: the contribution margin is $27 (60% of price), and 12,500 ÷ 27 = 462.96 units. The calculator rounds up to 463, because 462 whole units would still leave a sliver of fixed costs uncovered — you cannot sell ninety-six hundredths of a unit. At $45 each, those 463 units are $20,835 of break-even revenue.

The sales-dollars form for multi-product businesses

A café with forty menu items or a store with a thousand SKUs has no single "unit," so the per-unit formula has nothing to divide. The fix is to work at the ratio level: break-even revenue = fixed costs ÷ contribution margin ratio, where the ratio is blended across everything you sell.

The blended ratio comes straight off a recent P&L. A business with $200,000 of revenue and $130,000 of variable costs kept $70,000 of contribution — a 35% ratio. If its fixed costs are $42,000 a month, break-even is 42,000 ÷ 0.35 = $120,000 of monthly sales. The sales-dollars view of this calculator takes exactly those two inputs, and the answer is only as good as the ratio, so recompute it when your product mix shifts toward higher- or lower-margin items.

What break-even leaves out — and the target-profit extension

Break-even is deliberately simple, and three simplifications matter. It ignores cash timing — you can pass break-even on paper while unpaid invoices leave the bank account empty. It assumes fixed costs are flat, but most are step-fixed: pass a volume threshold and you need another employee, machine, or lease, which moves the break-even point you just calculated. And it says nothing about taxes, which take their share only after profit begins, so the volume that delivers a spendable profit target is higher than the pre-tax math suggests.

Breaking even is also not the goal — it is the floor. The target-profit view asks the better question: units = (fixed costs + target profit) ÷ contribution margin. Keeping the $10,000 fixed costs and $20 margin, a $20,000 monthly profit target needs (10,000 + 20,000) ÷ 20 = 1,500 units, or $75,000 of revenue — three times break-even volume. Running the target-profit number first makes a price or volume plan honest about what "success" actually requires.

By variant

• Break-Even Units Calculator
• Break-Even Sales Calculator

Questions

Is the break-even calculator free?

Yes. It is free, needs no account, and runs entirely in your browser — nothing you enter is uploaded or stored. The result is a planning estimate, not business or accounting advice.

What is a contribution margin ratio?

Contribution margin as a share of the price. At a $50 price with a $30 variable cost, each unit contributes $20, and 20 ÷ 50 = 40%. The calculator reports both the per-unit margin and the ratio on every calculation, and the sales-dollars view accepts the ratio directly.

Why does the calculator round units up?

Because partial units do not pay bills. With $9,984 of fixed costs and a $20 contribution margin, the raw division gives 499.2 units — but 499 whole units contribute only $9,980, leaving $4 of fixed costs uncovered. The calculator reports 500, the first whole-unit volume that actually breaks even.

What if my price is below the variable cost?

Then there is no break-even point at any volume — every sale loses money before fixed costs even enter the picture, and selling more digs the hole deeper. The calculator says so directly instead of returning a number; the fix is a higher price or a lower variable cost per unit.