Equity analyst and former FP&A lead with 12+ years in unit economics and pricing strategy across SaaS and manufacturing.
Enter any three values to solve the fourth. Supports currency-aware formatting, detailed steps, and error checks.
Break-Even Point (BEP) Calculator
Fields: Fixed Costs (F), Unit Price (P), Unit Variable Cost (V), Break-Even Units (Q). Provide any three.
Break-Even Point (BEP) Formula
P = V + F / Q
V = P − F / Q
F = Q × (P − V)
Formula Source: Investopedia – Break-Even Point
Variables
- F: Fixed Costs — expenses that do not vary with production (e.g., rent, salaries).
- P: Unit Price — selling price per unit.
- V: Unit Variable Cost — cost that varies with each unit produced (materials, direct labor).
- Q: Break-Even Units — units required to cover all costs (profit = 0).
Related Calculators
- Contribution Margin Calculator
- Target Profit Sales Calculator
- Price Elasticity Impact Calculator
- Operating Leverage Calculator
What is the Break-Even Point?
The break-even point (BEP) is the sales volume at which total revenue equals total costs, resulting in zero profit and zero loss. It tells you how many units you must sell before your product starts generating profit.
Understanding BEP is essential for pricing, cost control, and forecasting. By comparing unit price and unit variable cost, and layering in fixed costs, you can quickly test scenarios: raise price, lower variable costs, or reduce fixed overhead to reach break-even faster.
How to Calculate the Break-Even Point (Example)
- List Inputs
Assume Fixed Costs F = $50,000; Unit Price P = $40; Unit Variable Cost V = $22.
- Compute Contribution Margin
P − V = $40 − $22 = $18 per unit.
- Solve for Units
Q = F / (P − V) = $50,000 / $18 ≈ 2,777.78 units.
- Interpret
After selling about 2,778 units, revenue covers all costs; additional sales generate profit.
Frequently Asked Questions (FAQ)
Can break-even units be fractional?
Yes. The formula can produce decimals; in practice, you round up to the next whole unit since you can’t sell a fraction of a unit.
Why must price exceed variable cost?
If P ≤ V, the contribution margin is ≤ 0, so you can’t cover fixed costs regardless of volume.
What if my inputs don’t reconcile?
The calculator will flag inconsistent inputs (for example, F ≠ Q × (P − V) within tolerance) to help you spot data entry errors.
Is this the same as cash break-even?
No. Cash break-even excludes non-cash expenses like depreciation; this tool uses accounting costs as entered.