Break-Even Point Calculator

Calculates the sales volume and revenue at which you make neither a profit nor a loss (the break-even point, BEP) from fixed costs, variable cost per unit and price. Use it to see how much a business must sell each month.

How to use

1. Under "Monthly fixed costs", enter costs such as rent and salaries, one per line; "Add a line" adds more and the total is summed.
2. Under "Calculate by", choose "Product (per unit)" to enter a price and a variable cost per unit, or "Service (by revenue)" to enter an average sale and a variable cost ratio.
3. Break-even units, break-even revenue and the contribution margin appear at once. A "Target monthly profit" shows the sales needed for it.
4. Enter current sales to see your profit and margin of safety; the chart and sensitivity table compare changes in price and cost.

How it works

• Contribution margin = price − variable cost per unit, and break-even units = fixed costs ÷ contribution margin, rounded up to a whole unit.
• Break-even revenue = fixed costs ÷ contribution margin ratio. Service mode uses fixed costs ÷ (1 − variable cost ratio).
• The sensitivity table repeats the calculation with the price and the variable cost changed by ±5% and ±10%. Inputs are saved only in this browser.

Questions and answers

What is the break-even point formula?

Break-even units = fixed costs ÷ (price − variable cost per unit). With fixed costs of 3,000, a price of 10 and a variable cost of 4, that is 3,000 ÷ 6 = 500 units.

What is the contribution margin?

What each unit leaves after its variable cost to cover fixed costs. The contribution margin ratio is that amount divided by the price.

What does the margin of safety mean?

How far current sales are above break-even, as a share of current sales. At 20%, sales can fall by 20% before you make a loss.

What if the variable cost is higher than the price?

Each unit then loses money, so no sales volume breaks even. The page shows a message saying so.