Break-Even Calculator
Fixed costs divided by what each sale actually contributes once the variable cost is out.
Break-even is the sales volume where revenue exactly covers fixed and variable costs — the point before which every sale is a loss and after which it's profit. A business with $10,000 in monthly fixed costs, selling at $50 a unit with $30 of variable cost per unit, needs to sell 500 units a month ($10,000 ÷ $20 contribution margin) to break even — $25,000 in monthly revenue.
Raising the price or cutting variable cost per unit moves that number faster than cutting fixed costs usually can, since it widens the contribution margin on every single sale.
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