Break-even point
General calculation · any country
Find out how many units you need to sell in a period to cover your fixed costs and, if you like, to reach a target profit.
Units to cover costs
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Sales needed
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Contribution per unit
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Contribution ratio
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Units for your target
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Profit at different volumes
| Units | Sales | Profit |
|---|
How it is calculated
- Contribution per unit = price − variable cost per unit.
- Break-even units = (fixed costs + target profit) ÷ contribution per unit, rounded up.
- Break-even sales = units × price.
Assumptions
- Price and variable cost stay the same at any volume.
- Fixed costs cover the same period as sales (for example, one month).
- Amounts exclude sales taxes; profit is before tax.