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Break-Even Calculator

Use this break-even calculator to estimate how fixed costs, price per unit, variable cost per unit, contribution margin, and target profit affect break-even units and revenue.

Last reviewed June 6, 2026Source note includedPlanning estimate

Live calculator

Break-even point

Break-even units250

$48.00 contribution margin per unit.

Break-even revenue$19,750.00

60.8% contribution margin rate.

Units for target profit355

Includes $5,000.00 target profit.

Use this for planning and comparison. Contracts, collections, payables, tax timing, payroll, refunds, one-time bills, seasonality, and accounting treatment can change the real business result.

Quick answer

Break-Even Calculator: what it calculates

Break-Even Calculator uses fixed costs, price per unit, variable cost per unit, and contribution margin to estimate break-even units, break-even revenue, target profit planning, and units for target profit.

ResultBreak-even units
InputsFixed costs, Price per unit, Variable cost per unit, Target profit
FormulaBreak-even formula

Formula

Break-even formula

Break-even units = fixed costs / (price per unit - variable cost per unit)

The difference between price and variable cost is the contribution margin per unit.

How to use

Steps

  1. Enter fixed costs for the period.
  2. Enter price per unit and variable cost per unit.
  3. Add a target profit if you want a profit goal above break-even.
  4. Review break-even units, revenue, and contribution margin.

Example

Sample calculation

Fixed costs$12,000
Contribution margin per unit$48
Contribution margin rate60.8%
Break-even units250
Break-even revenue$19,750
Units for target profit355

Calculator use

Best for

  • Use this break-even calculator to estimate how fixed costs, price per unit, variable cost per unit, contribution margin, and target profit affect break-even units and revenue.
  • Estimating business pricing, margin, retention, runway, dilution, revenue, or profitability before an operating decision.
  • Comparing base, conservative, and optimistic assumptions with the revenue, cost, churn, or payment timing visible.
  • Preparing a planning number before updating books, forecasts, contracts, or investor materials.

Before relying on it

Check first

  • Mixing cash flow, accounting profit, bookings, revenue recognition, one-time fees, and recurring revenue.
  • Leaving out taxes, refunds, discounts, churn, payment delays, support cost, contractor cost, or owner time.
  • Using one optimistic case as the operating plan without checking downside assumptions.

Details

What to know before using the result

Contribution marginPrice minus variable cost

Contribution margin per unit is the amount each sale contributes toward fixed costs and profit before other period expenses.

Fixed vs variable costsSeparate the cost behavior

Fixed costs are the period costs you must cover even before sales. Variable costs move with each unit sold, such as materials, packaging, fulfillment, or direct commissions.

Target profit unitsBreak-even plus profit goal

Units for target profit divides fixed costs plus target profit by contribution margin per unit, so it shows the volume needed above zero-profit break-even.

Next decisionMove from volume to margin

After checking break-even, review profit margin, agency margin, client profitability, retainer pricing, and small-business cash flow before changing price, cost, or sales targets.

Source notes

References used for this calculator

U.S. Small Business AdministrationExplains break-even analysis, contribution margin, and how pricing affects profitability.

Benchmarks

How to read the result

Negative contribution: No break-even.

If variable cost is greater than or equal to price, each sale loses money before fixed costs.

Low contribution: Longer path.

Small contribution margin means more units are needed to cover fixed costs.

High contribution: Shorter path.

Higher contribution margin lowers the units needed to reach break-even.

Calculator accuracy

Methodology and assumptions

Formula

Break-even units = fixed costs / (price per unit - variable cost per unit)

Inputs used

Fixed costs, Price per unit, Variable cost per unit, Target profit

Limitations

Business results depend on contracts, accounting treatment, taxes, payment timing, refunds, collections, and operating assumptions.

Last reviewed

June 6, 2026

Cite this page

Toolkit Shelf. Break-Even Calculator. Last reviewed June 6, 2026. https://toolkitshelf.com/tools/break-even-calculator

FAQ

Common questions

What is break-even point?

Break-even point is the unit volume or revenue where profit is zero after covering fixed and variable costs.

What is contribution margin?

Contribution margin is price per unit minus variable cost per unit. It is the amount each sale contributes toward fixed costs and profit.

Should I include payroll in fixed costs?

Include payroll, rent, software, insurance, and other costs that must be covered during the period you are modeling.

How do I calculate units for target profit?

Add target profit to fixed costs, then divide by contribution margin per unit. That shows the sales volume needed to cover costs and reach the profit goal.

Can this replace accounting or legal advice?

No. Business tools are scenario planners. Contracts, taxes, payment timing, accounting treatment, refunds, and legal requirements can change decisions.

What should I do after using a business tool?

Save the assumptions, compare a conservative scenario, and review the result with actual books, contracts, or an advisor before making a high-stakes decision.