Break-Even Calculator
How many units you must sell before the fixed costs are covered.
The formula
break-even units = fixed costs / (price - variable cost)
Each sale contributes price minus variable cost toward the fixed costs; at $25 price and $15 variable cost, every unit contributes $10, so $10,000 of fixed costs needs 1,000 units. Past that point, each unit's contribution is profit.
Using it for decisions
Break-even analysis shines on what-ifs: a price rise from $25 to $27 cuts the example's break-even from 1,000 to 833 units, while a $2,000 marketing spend raises it by 200. The model assumes every unit sells at one price and costs scale linearly, which is fine for a first cut; volume discounts and stepped costs (a second machine, a new hire) need a fuller model.