What is Break-even point?
The break-even point is the number of units (or revenue) where total contribution covers fixed costs: fixed costs ÷ (price − variable cost per unit).
Example
$3,000 of monthly fixed costs and $20 of contribution per unit means 150 units to break even.
Why it matters
It shows the minimum monthly sales your business needs before it makes any profit.
Calculate it: Break-Even Calculator
Units and revenue to cover your costs
Flashcard
Question
What is break-even point?
Tap to reveal the answerAnswer
The break-even point is the number of units (or revenue) where total contribution covers fixed costs: fixed costs ÷ (price − variable cost per unit).