Break-Even Point Calculator Examples
See worked examples of break-even units, break-even revenue, and target profit calculations for different business scenarios.
These examples show how the break-even point changes when fixed costs, selling price, variable cost, and profit targets change. Use them to understand how pricing and cost structure affect the sales volume you need.
Example 1: Small handmade product business
A maker sells candles online and wants to know how many units are needed to cover monthly costs.
Input Summary
Fixed costs
$1,200
Selling price per unit
$24
Variable cost per unit
$9
Target profit
$0
Calculation Breakdown
- 1Contribution margin per unit24 - 9$15.00
- 2Contribution margin ratio15 / 240.625 or 62.5%
- 3Break-even units1200 / 1580 units
- 4Break-even revenue1200 / 0.625$1,920.00
Result Summary
Break-even revenue
$1,920.00
Break-Even Point Calculator
The business breaks even at 80 units or $1,920.00 in revenue.
Example 2: Café menu item with higher overhead
A café wants to estimate how many lunch bowls it must sell each month to cover rent, wages, and subscriptions.
Input Summary
Fixed costs
$8,000
Selling price per unit
$14
Variable cost per unit
$6
Target profit
$0
Calculation Breakdown
- 1Contribution margin per unit14 - 6$8.00
- 2Contribution margin ratio8 / 140.5714 or 57.14%
- 3Break-even units8000 / 81,000 units
- 4Break-even revenue8000 / 0.5714$14,000.00
Result Summary
Break-even revenue
$14,000.00
Break-Even Point Calculator
The café breaks even at 1,000 units or about $14,000.00 in revenue.
Example 3: Software subscription with target profit
A small software company wants to know how many monthly subscriptions it needs to sell to cover operating costs and earn a target profit.
Input Summary
Fixed costs
$12,000
Selling price per unit
$40
Variable cost per unit
$10
Target profit
$6,000
Calculation Breakdown
- 1Contribution margin per unit40 - 10$30.00
- 2Contribution margin ratio30 / 400.75 or 75%
- 3Break-even units12000 / 30400 units
- 4Units for target profit(12000 + 6000) / 30600 units
- 5Revenue for target profit18000 / 0.75$24,000.00
Result Summary
Revenue for target profit
$24,000.00
Break-Even Point Calculator
The company breaks even at 400 subscriptions and needs 600 subscriptions to earn $6,000 profit.
Example 4: Low-margin wholesale product
A wholesaler sells a low-margin household item and wants to understand the effect of thin unit economics.
Input Summary
Fixed costs
$15,000
Selling price per unit
$12
Variable cost per unit
$9.50
Target profit
$0
Calculation Breakdown
- 1Contribution margin per unit12 - 9.50$2.50
- 2Contribution margin ratio2.50 / 120.2083 or 20.83%
- 3Break-even units15000 / 2.506,000 units
- 4Break-even revenue15000 / 0.2083$72,000.00
Result Summary
Break-even revenue
$72,000.00
Break-Even Point Calculator
The wholesaler breaks even at 6,000 units or about $72,000.00 in revenue.
How to Read Your Results
Break-even units show the estimated sales volume needed to cover fixed costs before profit begins.
Break-even revenue shows the sales amount required to reach zero profit and zero loss.
Contribution margin per unit helps explain why higher prices or lower variable costs reduce the break-even point.
If your result includes decimal units, round up when planning actual sales targets.
Target profit results build on break-even analysis by adding your desired profit to fixed costs first.
Assumptions & Important Notes
- Fixed costs are constant for the period used in the example.
- The selling price and variable cost per unit do not change within each scenario.
- All calculated units are assumed to be sold during the same period.
- Examples are simplified educational estimates and do not include taxes or financing costs.
Related Examples
Frequently Asked Questions
Why do some examples need many more units to break even?
Businesses with lower contribution margin per unit need to sell more units to cover the same fixed costs.
What does a higher contribution margin ratio mean?
It means a larger share of each sales dollar is available to cover fixed costs and profit, which usually lowers break-even revenue.
Can the same break-even revenue come from different unit counts?
Yes. Different prices and margins can lead to different unit sales levels even if revenue is similar.
Do these examples include taxes or interest expense?
No. They are simplified operating estimates based on fixed costs, variable cost per unit, price, and optional target profit.
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