Break-Even Calculator

Updated Sep 2026 Used 1 times

Unit economicsDefine price and per-unit cost on the same unit basis.

Selling price per unit

Net selling price received per unit before variable costs.

Variable cost per unit

Cost that changes with each additional unit sold.

Period planUse one consistent month, quarter, year, project, or event.

Fixed costs for the period

Costs that do not change with units sold during the selected period.

Target profit for the period

Profit goal added to fixed costs for target-volume planning.

Projected unit sales

Expected unit sales used for projected profit and margin of safety.

SensitivityStress lower price and higher variable cost separately.

Price and cost stress test

Models a price decrease and a variable-cost increase separately.

Guest calculations stay on this device. Signed-in results sync privately.

Your result

Break-even whole units

Enter your values, then calculate to see a verified result.

Inputs usedReview the information used for this result.

Full calculation and sourcesOpen Full calculation and sources to audit the formula, breakdown, assumptions, and source version.

Versioned calculationFormula v1.0.0

More than one threshold

See exact and whole units, revenue, target-profit volume, projected profit, margin of safety, and two stress cases.

Transparent calculation

Inputs, formula path, output bridge, limitations, and sources remain visible.

Private by default

Guest calculations run in the browser and are not sent to a lead form.

Use one periodKeep fixed costs and sales volume on the same time basis.Monthly with monthly

Define one unitUse the same product, service hour, seat, or order for price and variable cost.One sale or one billable hour

Stress the marginReview lower-price and higher-cost break-even volumes.Do not rely on one forecast

Interpretation

A larger contribution margin lowers the break-even volume.

Margin of safety measures how far projected volume sits above break-even.

Profit is not cash flow; payment timing and working capital still matter.

Use this result

Model embedded-payments economicsUse adoption, transaction, take-rate, and provider-cost drivers for a fintech scenario.Keep financing separateUse a dedicated financing model when business equipment or vehicles are debt-funded.

Keep exploring

1 available tools

Embedded Payments Unit Economics CalculatorModel a more detailed payment-platform contribution stack.

Public verification recordFormula v1.0.0

Review scope: Business-cost-volume-profit
Review team: CalculatorGeek Algorithmic Team
Verified: 2026-09-26
Next source review: 2027-09-26
Automated fixtures: 6 cases

Review method

The SBA contribution-margin formula was independently derived, whole-unit ceiling and infeasible cases were tested, and extensions were checked for target profit, projection, safety, and sensitivity.

Known limitations

The model assumes price and variable cost per unit remain constant over the relevant range.
It is a single-product or constant weighted-mix model and does not optimize multiple products.
Taxes, financing, working capital, capacity steps, inventory timing, owner labor, and cash flow require separate modeling unless entered in the cost assumptions.

Primary sources

U.S. Small Business Administration - Break-even point

Published calculation checks

Case	Inputs	Expected result
SBA-style base case	See the versioned calculator fixture.	{"contribution_margin_per_unit":20,"contribution_margin_ratio":40,"break_even_units_exact":500,"break_even_units":500,"break_even_revenue":25000}
Whole unit ceiling is practical threshold	See the versioned calculator fixture.	{"break_even_units_exact":83.3333333333,"break_even_units":84}
Target profit volume	See the versioned calculator fixture.	{"target_profit_units_exact":750,"target_profit_units":750,"target_profit_revenue":37500}

On this page

What the Break-Even Calculator calculates

This Break-Even Calculator finds the exact and whole-unit volume where contribution margin covers fixed costs. It also calculates break-even revenue, units and revenue for a target profit, projected profit or loss, margin of safety, and separate lower-price and higher-variable-cost stress cases.

The result is meaningful only when every amount uses the same period and the selling price exceeds variable cost per unit.

How to use this calculator

Choose one planning period and total the fixed costs for it.
Enter the net selling price and variable cost for one consistent unit.
Add a target profit and projected unit volume.
Use the sensitivity percentage to see how a lower price or higher variable cost changes the threshold.

For a payments platform with adoption, take-rate, processor, loss, and support economics, use the Embedded Payments Unit Economics Calculator.

Method and formula

Contribution margin per unit equals selling price minus variable cost per unit. Exact break-even units equal fixed costs divided by contribution margin; whole break-even units use a ceiling because a fraction of a unit normally cannot be sold. Break-even revenue uses the whole-unit result so the displayed practical threshold actually covers fixed costs.

Target-profit units replace fixed costs with fixed costs plus target profit. Projected profit equals projected units multiplied by contribution margin, minus fixed costs. Margin of safety compares projected units with exact break-even units.

Worked example

With $10,000 of monthly fixed costs, a $50 selling price, and $30 variable cost per sale, contribution is $20 per unit and the contribution ratio is 40%. Break-even is 500 units or $25,000 of revenue. A $5,000 target profit requires 750 units, while 700 projected units produce $4,000 of operating profit before omitted items.

How to interpret the result

Use the whole-unit threshold for an operational target and the exact value for analysis. If a modest price decrease or cost increase creates a sharp jump, the model has little cushion. Compare projected profit with margin of safety and then build a cash-flow plan for payment timing.

Assumptions and limitations

The linear model assumes a constant selling price, unit cost, product mix, and fixed-cost structure. Volume discounts, overtime, capacity steps, refunds, spoilage, commissions, taxes, financing, and multiple product margins can change the real threshold. Include owner labor and recurring overhead when they are economic costs of the period.

Inputs, outputs and result meaning

Combines the core break-even formula with whole-unit rounding, target profit, projected profit, margin of safety, and explicit price and cost stress cases.

Inputs

Fixed costs for the period: Costs that do not change with units sold during the selected period.
Selling price per unit: Net selling price received per unit before variable costs.
Variable cost per unit: Cost that changes with each additional unit sold.
Target profit for the period: Profit goal added to fixed costs for target-volume planning.
Projected unit sales: Expected unit sales used for projected profit and margin of safety.
Price and cost stress test: Models a price decrease and a variable-cost increase separately.

Outputs

Break-even whole units: Primary result. Calculated from the displayed inputs without intermediate display rounding.
Break-even units before whole-unit ceiling: Calculated from the displayed inputs without intermediate display rounding.
Break-even revenue: Calculated from the displayed inputs without intermediate display rounding.
Contribution margin per unit: Calculated from the displayed inputs without intermediate display rounding.
Contribution margin ratio: Calculated from the displayed inputs without intermediate display rounding.
Whole units for target profit: Calculated from the displayed inputs without intermediate display rounding.
Revenue for target profit: Calculated from the displayed inputs without intermediate display rounding.
Projected profit or loss: Calculated from the displayed inputs without intermediate display rounding.
Margin of safety in units: Calculated from the displayed inputs without intermediate display rounding.
Margin of safety: Calculated from the displayed inputs without intermediate display rounding.
Break-even units after price decrease: Calculated from the displayed inputs without intermediate display rounding.
Break-even units after variable-cost increase: Calculated from the displayed inputs without intermediate display rounding.

Frequently asked questions

What is the break-even formula?

Fixed costs divided by selling price minus variable cost per unit.

Why does the calculator round units up?

Selling a fractional unit usually cannot cover the remaining cost, so the practical threshold is the next whole unit.

Can a service business use it?

Yes. Define one unit as a billable hour, appointment, seat, project, or other consistent service unit.

What if variable cost is higher than price?

There is no finite break-even volume under that scenario because every additional sale loses contribution.

Is break-even the same as cash-flow positive?

No. Break-even is an accrual-style cost-volume relationship; cash timing and working capital can differ.

Primary sources and review record

U.S. Small Business Administration - Break-even point

Method and sources reviewed 2026-09-26. The calculator shows its assumptions and does not replace an official eligibility decision, professional advice, or a measurement made under controlled conditions.