The break-even calculator computes the point where your revenue exactly covers your costs: enter the selling price, the variable cost per unit, and your total fixed costs, and it returns the contribution margin per unit, the break-even quantity in units, and the break-even revenue. The method is standard: every unit sold contributes price minus variable cost toward fixed costs, so the break-even quantity is fixed costs divided by that contribution. If the price is at or below the variable cost, the calculator refuses to compute — every sale then adds a loss and no break-even point exists. The calculator assumes the business is break-even in the accounting sense (operating profit of zero) and does not include taxes, interest, or one-off items unless you fold them into fixed costs. Full decimal precision is kept internally; rounding applies only to displayed units and money. Everything runs locally in your browser — your numbers never leave your device and are never logged. Use this calculator when launching a product, evaluating a price change, or checking how many subscriptions or items you need to sell each month.
How is the result calculated?
Subscription launch: price 25, variable cost 15, fixed 10,000
A software subscription sells for $25/month and costs $15/month to deliver (hosting and support). Each subscription contributes $10 toward fixed costs of $10,000/month (office, salaries, tools). Break-even is 10,000 / 10 = 1,000 subscriptions, which is $25,000 of monthly recurring revenue. Selling 900 subscriptions still loses $1,000/month even though the product is profitable per unit.
Example input and output | Input | Value |
| price | 25.00 |
| variableCost | 15.00 |
| fixedCosts | 10000.00 |
| Result | Contribution $10.00/unit · break-even 1,000 units · $25,000.00 revenue |
What is the formula and its assumptions?
Contribution margin per unit
contribution = price − variable cost per unit
Formula terms | Symbol | Meaning |
price | selling price per unit |
variable cost per unit | cost that changes with each unit sold |
Break-even units
break-even units = fixed costs / contribution per unit
Formula terms | Symbol | Meaning |
fixed costs | costs that do not change with volume (rent, salaries, software) |
contribution per unit | price minus variable cost per unit |
Break-even revenue
break-even revenue = break-even units × price
Formula terms | Symbol | Meaning |
price | selling price per unit |
Equivalently, fixed costs divided by the contribution ratio. The result is revenue, not units — quoting the wrong one is a classic mistake.
What are the most common mistakes?
- Forgetting non-obvious variable costs (payment fees, per-unit shipping) and ending up below true break-even.
- Quoting break-even revenue as units or vice versa — they differ by the price.
- Assuming fixed costs stay fixed forever; step costs (a second hire, more office space) change the break-even at scale.
What are the assumptions and limitations?
- Assumes constant price, cost, and volume relationship — no bulk discounts, price elasticity, or taxes.
- Break-even here means zero operating profit; it is not a cash-flow projection.
- Results are planning estimates, not professional financial advice.
Where do the numbers come from?
Last reviewed August 4, 2026 · Version 1.0.0 · Toolivaro does not guarantee external content.
Frequently asked questions
What counts as a variable cost?
Variable costs change with volume: product materials, per-unit shipping, payment-processing fees, and per-customer hosting. Rent, salaries, and software subscriptions are fixed costs. Classifying a cost wrongly moves the break-even point materially.
What if my break-even is not a whole number?
The calculator keeps the exact result (for example 834.7 units). In practice you must sell the next whole unit — 835 — to pass the break-even point. The displayed value is rounded for reading, not for decision-making.
What does it mean if price is below variable cost?
That every sale loses money, so there is no break-even quantity — selling more only increases the loss. The calculator refuses to compute and explains this instead of returning a misleading number.
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