# Break even point: how many to sell?

Computes the break-even point in units and in sales dollars from fixed costs, price per unit and variable cost per unit, or the units to sell for a target profit.

- Page: https://www.acalculator.org/finance/break-even-calculator
- JSON spec: https://www.acalculator.org/finance/break-even-calculator.json
- Version: 5bea605170f7

## Default answer

Example with the default inputs (Fixed costs $18,000.00, Price per unit $100.00, Variable cost per unit $20.00, Target profit $0.00): Units to sell: 225, or $22,500.00 in sales, to cover your fixed costs and target profit.

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| fc | Fixed costs | Costs that stay the same however much you sell, such as rent and salaries, for the period. |
| p | Price per unit | What you charge for one unit. |
| vc | Variable cost per unit | What one more unit costs you to make or sell, such as materials. |
| tp | Target profit | The profit you want for the period. 0 finds the break-even point. |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| units | Units to sell | The exact units rounded up to a whole unit. |
| exactUnits | Units (exact) | (Fixed costs + target profit) ÷ contribution margin per unit. |
| sales | Sales in dollars | (Fixed costs + target profit) ÷ contribution margin ratio: the revenue at the exact units. |
| margin | Contribution margin per unit | Price − variable cost per unit. |
| ratio | Contribution margin ratio | Contribution margin per unit ÷ price, as a percent. |
| profitAtUnits | Profit at the whole units | Margin × whole units − fixed costs: the profit when you sell the rounded-up units. |

## Method

Contribution margin = price − variable cost; break-even units = (fixed costs + target profit) ÷ margin, rounded up; sales dollars = (fixed costs + target profit) ÷ (margin ÷ price).

## Assumptions

- Price, variable cost per unit and fixed costs stay the same at every level of sales in the period.
- Every unit made is sold. Taxes are left out.
- Fixed costs, price and target profit are for the same period (a month or a year).

## Worked examples

1. fc = $18,000.00, p = $100.00, vc = $20.00 gives units = 225, exactUnits = 225, sales = $22,500.00, margin = $80.00, ratio = 80%. Source: OpenStax, Principles of Accounting, Volume 2: Managerial Accounting, §3.2 Calculate a Break-Even Point in Units and Dollars. https://openstax.org/books/principles-managerial-accounting/pages/3-2-calculate-a-break-even-point-in-units-and-dollars (fixed costs $18,000, price $100, variable cost $20: 225 units or $22,500).
2. fc = $14,000.00, p = $400.00, vc = $150.00 gives units = 56, sales = $22,400.00, margin = $250.00, ratio = 62.5%. Source: OpenStax, Principles of Accounting, Volume 2: Managerial Accounting, §3.2 Calculate a Break-Even Point in Units and Dollars. https://openstax.org/books/principles-managerial-accounting/pages/3-2-calculate-a-break-even-point-in-units-and-dollars (fixed costs $14,000, charge $400, variable cost $150: 56 returns or $22,400).
3. fc = $16,800.00, p = $1,250.00, vc = $850.00 gives units = 42, sales = $52,500.00, ratio = 32%. Source: OpenStax, Principles of Accounting, Volume 2: Managerial Accounting, §3.2 Calculate a Break-Even Point in Units and Dollars. https://openstax.org/books/principles-managerial-accounting/pages/3-2-calculate-a-break-even-point-in-units-and-dollars (fixed costs $16,800, price $1,250, variable cost $850: 42 units or $52,500).
4. fc = $3,000.00, p = $35.00, vc = $20.00, tp = $1,000.00 gives exactUnits = 266.666667, units = 267, sales = $9,333.33, profitAtUnits = $1,005.00. Source: OpenStax, Principles of Accounting, Volume 2: Managerial Accounting, §3.2 Calculate a Break-Even Point in Units and Dollars. https://openstax.org/books/principles-managerial-accounting/pages/3-2-calculate-a-break-even-point-in-units-and-dollars (target profit: (fixed costs + desired profit) ÷ contribution margin per unit).

## FAQ

### How do I calculate the break even point?

Divide fixed costs by the contribution margin per unit (price − variable cost). With $18,000 of fixed costs, a $100 price and a $20 variable cost, the margin is $80 and the break-even point is 18,000 ÷ 80 = 225 units.

### How do I find the break-even point in sales dollars?

Divide fixed costs by the contribution margin ratio (margin ÷ price). In the example the ratio is 80 ÷ 100 = 80%, so sales must reach 18,000 ÷ 0.80 = $22,500, the same as 225 units × $100.

### What is a contribution margin?

It is what each unit sold adds toward fixed costs and profit: price minus variable cost per unit. A $35 haircut that costs $20 in supplies and pay has a $15 margin.

### How many units do I need for a target profit?

Add the target profit to the fixed costs and divide by the margin. For $1,000 of profit on $3,000 of fixed costs and a $15 margin: 4,000 ÷ 15 = 266.67, so sell 267 units.

### Why is the answer rounded up?

You cannot sell part of a unit. 266.67 units falls short, so the calculator shows 267, which covers the costs with a little profit left over. The exact figure is shown too.

### What if my price is lower than my variable cost?

Then every sale loses money and no amount of sales breaks even. Raise the price or cut the variable cost so that the margin is above zero.

## Sources

- OpenStax, Principles of Accounting, Volume 2: Managerial Accounting, §3.2 Calculate a Break-Even Point in Units and Dollars (break-even units = fixed costs ÷ contribution margin per unit; dollars = fixed costs ÷ contribution margin ratio; target profit; Hicks Manufacturing, Marshall & Hirito and Channing’s Chairs examples). https://openstax.org/books/principles-managerial-accounting/pages/3-2-calculate-a-break-even-point-in-units-and-dollars (retrieved 2026-10-02)
- U.S. Small Business Administration, Calculate your startup costs (fixed and variable costs for a new business). https://www.sba.gov/business-guide/plan-your-business/calculate-your-startup-costs (retrieved 2026-10-02)