Break-Even Calculator
Calculate how many units (or projects) you must sell to cover fixed costs at your price and variable cost.
Calculator
Rent, salaries, software—costs that don’t change with each sale.
Materials, contractors, payment fees tied to each sale.
Results
Break-even units
90.91
Break-even revenue
$13,636.36
Contribution margin / unit
$110.00
What this means
Break-even at about 91 units. Treat it as a planning target, not a guarantee—mix and price changes move this number.
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Break-Even Summary
Break-even units = Fixed costs ÷ (Price − Variable cost per unit). That contribution margin must be positive or you cannot break even.
Explanation
Contribution margin per unit is price minus variable cost—what each sale contributes toward fixed costs.
Break-even units / revenue are the volume and sales dollars needed to cover fixed costs.
Business implication: if break-even is unrealistically high, cut fixed costs or improve unit economics before scaling spend.
Step-by-step example
Fixed costs $10,000, price $150, variable cost $40:
- Contribution: $150 − $40 = $110
- Break-even units: $10,000 ÷ $110 ≈ 90.91
- Break-even revenue ≈ $13,636
Formula
Contribution = Price − Variable cost
Break-even units = Fixed costs ÷ Contribution
Break-even revenue = Break-even units × Price
Helpful tips
- Recompute when you add headcount or tools—fixed costs move the goalposts.
- Include payment fees in variable cost when they scale with sales.
FAQ
What is break-even?
Break-even is the sales volume where contribution from each unit covers all fixed costs—profit is zero, and losses stop accumulating.
What if price is lower than variable cost?
There is no break-even volume: every sale loses money on variable costs alone. Raise price or cut variable cost first.
Can I use this for projects instead of units?
Yes. Treat each project as a “unit,” with fixed monthly overhead, average project fee as price, and average delivery cost as variable cost.
How accurate is this calculator?
It assumes linear costs and a stable price. Real businesses have step-fixed costs and discounts—use it as a planning baseline.
Related tools
Key terms
Break-even
Definition. The sales level where contribution covers fixed costs—so profit is roughly zero.
In simple terms. Below break-even you lose money; above it, each incremental sale contributes more to profit (within capacity). Useful for pricing and capacity decisions.
Break-even units ≈ fixed costs ÷ (price − variable cost per unit)
Example. Fixed costs $5,000/month, $40 contribution per unit → break-even at 125 units.
Common mistake. Treating all costs as variable, or ignoring that break-even can shift when pricing or mix changes.
Related calculators. Break-Even Calculator
Related terms. Profit margin, Gross margin, Burn rate
Profit margin
Definition. Profit as a percentage of revenue—how much of each sales dollar remains after the costs you include.
In simple terms. Margin answers “is this business (or period) actually profitable?” Define costs the same way every time so comparisons mean something.
Profit margin = profit ÷ revenue (profit = revenue − costs)
Example. $20,000 profit on $100,000 revenue is a 20% profit margin.
Common mistake. Mixing personal draws, one-off investments, and operating costs without labeling what the margin includes.
Related calculators. Profit Margin Calculator, Gross Margin Calculator
Related terms. Gross margin, Break-even, ROI
Gross margin
Definition. Revenue minus cost of goods sold (or direct delivery costs), often shown as a percentage of revenue.
In simple terms. Gross margin shows whether the core offer is priced above direct cost before overhead like rent, software, and marketing.
Gross margin % = (revenue − COGS) ÷ revenue
Example. Sell $10,000 of product with $4,000 COGS → $6,000 gross profit → 60% gross margin.
Common mistake. Stuffing all operating expenses into COGS (or leaving direct labor out) and misreading the business model.
Related calculators. Gross Margin Calculator, Profit Margin Calculator
Related terms. Profit margin, Break-even
Notes & Assumptions
Cost-volume-profit (CVP) break-even analysis is a standard managerial accounting tool.
Last reviewed: July 2026