Break-Even Calculator

Break-Even is evaluated from Total Fixed Costs, Selling Price per Unit and Variable Cost per Unit. The calculation reports Contribution Margin per Unit, Contribution Margin% and Break-Even Units.

Results

Thanks — we’ve logged this for review.

About the Break-Even Calculator

Break-Even is treated here as a quantitative relation between Total Fixed Costs, Selling Price per Unit, Variable Cost per Unit and Target Profit and Contribution Margin per Unit, Contribution Margin%, Break-Even Units and Break-Even Revenue.

The calculator uses a multi formula configuration. Each reported value is read as a direct evaluation of the stored rules with the declared field formats and units.

Formula basis:
Contribution Margin = price - variable cost per unit
Break-even units = fixed costs / contribution margin
Break-even revenue = fixed costs / contribution margin%
Margin of safety = actual units - break-even units

Interpret the outputs in the order shown by the result fields. Optional inputs affect only the outputs that depend on those variables.

Formula & How It Works

The calculation applies the following relations exactly as recorded in the metadata:

Contribution Margin = price - variable cost per unit
Break-even units = fixed costs / contribution margin
Break-even revenue = fixed costs / contribution margin%
Margin of safety = actual units - break-even units

Each output field is produced by substituting the supplied inputs into the relevant relation and then applying the declared rounding or text format.

Worked Examples

Example 1: New food truck: $3,500/mo fixed costs, $8 selling price per item, $3.50 variable cost

Inputs

fixed_costs: 42000 selling_price: 8 variable_cost: 3.5 target_profit: 30000 actual_units: 9000
Contribution Margin per Unit: $4.5. Contribution Margin%: 56.25%. Break-Even Units: 9,334 units. Break-Even Revenue: $74,666.67. Units to Reach Target Profit: 16,000 units. Margin of Safety: 0 units. Margin of Safety%: 0%

With Total Fixed Costs = 42,000, Selling Price per Unit = 8, Variable Cost per Unit = 3.5 and Target Profit = 30,000 as the stated inputs, the result is Contribution Margin per Unit = $4.5, Contribution Margin% = 56.25% and Break-Even Units = 9,334 units. Each value corresponds to the declared output fields.

Example 2: Software product: $200k annual fixed costs (servers, salaries), $49/mo SaaS at $2/user variable

Inputs

fixed_costs: 200000 selling_price: 49 variable_cost: 2 target_profit: 100000 actual_units: 5000
Contribution Margin per Unit: $47. Contribution Margin%: 95.92%. Break-Even Units: 4,256 units. Break-Even Revenue: $208,510.64. Units to Reach Target Profit: 6,383 units. Margin of Safety: 745 units. Margin of Safety%: 15%

With Total Fixed Costs = 200,000, Selling Price per Unit = 49, Variable Cost per Unit = 2 and Target Profit = 100,000 as the stated inputs, the result is Contribution Margin per Unit = $47, Contribution Margin% = 95.92% and Break-Even Units = 4,256 units. Each value corresponds to the declared output fields.

Example 3: Retail product: $15,000 fixed setup costs, $19.99 price, $7.50 variable cost

Inputs

fixed_costs: 15000 selling_price: 19.99 variable_cost: 7.5 target_profit: 25000 actual_units: 1800
Contribution Margin per Unit: $12.49. Contribution Margin%: 62.48%. Break-Even Units: 1,201 units. Break-Even Revenue: $24,007.21. Units to Reach Target Profit: 3,203 units. Margin of Safety: 599 units. Margin of Safety%: 33%

With Total Fixed Costs = 15,000, Selling Price per Unit = 19.99, Variable Cost per Unit = 7.5 and Target Profit = 25,000 as the stated inputs, the result is Contribution Margin per Unit = $12.49, Contribution Margin% = 62.48% and Break-Even Units = 1,201 units. Each value corresponds to the declared output fields.

Example 4: Gym/fitness studio: $18,000/month fixed costs, $50/month membership, $5 variable per member

Inputs

fixed_costs: 216000 selling_price: 50 variable_cost: 5 target_profit: 60000 actual_units: 600
Contribution Margin per Unit: $45. Contribution Margin%: 90%. Break-Even Units: 4,800 units. Break-Even Revenue: $240,000. Units to Reach Target Profit: 6,134 units. Margin of Safety: 0 units. Margin of Safety%: 0%

With Total Fixed Costs = 216,000, Selling Price per Unit = 50, Variable Cost per Unit = 5 and Target Profit = 60,000 as the stated inputs, the result is Contribution Margin per Unit = $45, Contribution Margin% = 90% and Break-Even Units = 4,800 units. Each value corresponds to the declared output fields.

Common Use Cases

  • Calculate break-even units for a new product
  • Determine minimum sales volume to cover fixed costs
  • Analyze contribution margin and margin of safety