Break-even units
0
Price per unit must be higher than variable cost to break even.
Contribution margin / unit โน0
Break-even revenue โน0
How break-even works
Break-even units = fixed costs รท (price โ variable cost per unit). The bracket is your contribution margin โ what each unit adds toward covering fixed costs. Once you sell past the break-even point, each extra unit is profit. If variable cost is equal to or above price, you can never break even at that price.
FAQs
Break-even units = fixed costs รท (price โ variable cost). Multiply by price for revenue.
Price minus variable cost per unit โ the amount each unit contributes to fixed costs and profit.