Break-Even Units Calculator
Example: Total fixed costs (per period): 20000 $ · Selling price per unit: 50 $ · Variable cost per unit: 30 $
| Units to break even | 1,000 |
| Revenue at break-even | $50,000 |
| Contribution margin per unit | $20 |
| Contribution margin | 40.00% |
Worked example
With $20,000 in fixed costs, a $50 price, and $30 of variable cost, each unit contributes $20 toward fixed costs. Dividing $20,000 by $20 gives 1,000 units to break even, which at $50 each is $50,000 in revenue. Every unit sold past 1,000 drops $20 straight to profit. Raise the price or cut the variable cost and the contribution margin rises, pulling the break-even point lower.
Frequently asked questions
What is a contribution margin?
It is the price of a unit minus its variable cost, the amount each sale contributes toward covering fixed costs and then profit. A higher contribution margin means you break even on fewer units.
What counts as a fixed versus variable cost?
Fixed costs stay the same regardless of volume, such as rent, salaries, and insurance. Variable costs rise with each unit, such as materials, packaging, and per-unit shipping or payment fees.
Why does the result round up?
You cannot sell a fraction of a unit and still be profitable, so the calculator rounds up to the next whole unit that fully covers your fixed costs.
How do I lower my break-even point?
Raise your price, cut your variable cost per unit, or reduce fixed costs. Any of the three widens the contribution margin or shrinks what it has to cover, so you break even sooner.