Break-Even Calculator

The break-even point is the sales volume at which total revenue equals total fixed and variable costs. At that point, accounting profit is zero: the business has covered the costs included in the calculation but has not yet produced a profit.

Break-even units equal fixed costs divided by contribution per unit. Contribution per unit is selling price minus variable cost per unit. This calculator rounds the result up because most businesses cannot sell a fraction of a physical unit.

Include costs that do not change directly with the number of units sold during the chosen period, such as rent, salaried payroll, insurance and software. Keep the period consistent and do not include the same cost again as a variable cost.

Include costs that rise with each additional sale, such as product cost, packaging, unit-level shipping, payment fees and sales commissions. Use an average per-unit amount when a cost varies across orders.

When variable cost equals or exceeds selling price, each additional sale contributes zero or a negative amount toward fixed costs. Selling more units therefore cannot cover fixed costs unless pricing or unit cost changes.

No. Break-even revenue is the sales revenue required to cover the costs entered. Revenue above that level may create profit, but only if prices and costs remain consistent and no omitted expenses reduce the result.

Include taxes only when they are a cost to the business and are not already embedded in another input. Sales taxes collected for a tax authority are usually not revenue, while income tax treatment depends on jurisdiction and entity structure.

Update it whenever prices, supplier costs, fees, rent, payroll or the product mix changes. Businesses with volatile input costs may need to review break-even assumptions monthly or before major pricing and inventory decisions.