Clear Calculator

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Reviewed by: David Chen, CFA

Financial Strategy Expert & Investment Analyst

Achieving financial clarity starts with understanding your break-even point. Use this Clear Calculator to determine exactly how many units you need to sell or what price to set to cover all your business costs.

Clear Calculator

Calculated Result: $0.00

Clear Calculator Formula

Fixed Costs + (Variable Costs × Q) = Price × Q

To find the Break-Even Quantity (Q), the formula is rearranged to:

Q = Fixed Costs / (Price – Variable Cost)

Source: Investopedia – Break-Even Point Definition | Harvard Business Review

Variables Explanation:

  • Fixed Costs (F): Costs that do not change with production volume (e.g., rent, insurance).
  • Price (P): The amount you charge customers per individual unit.
  • Variable Cost (V): Costs that vary directly with production (e.g., materials, labor per unit).
  • Quantity (Q): The number of units sold or produced to reach the clear financial point.

What is a Clear Calculator?

A Clear Calculator, commonly known as a Break-Even Analysis tool, is a financial instrument used to determine the exact point where total revenue equals total costs. At this stage, your business is neither making a profit nor incurring a loss—it is “clear.”

By using this calculator, entrepreneurs and managers can assess the feasibility of their pricing strategies and understand the risks associated with their cost structures before launching a new product or service.

How to Calculate Break-Even (Example)

  1. Identify your total Fixed Costs (e.g., $2,000 for office rent).
  2. Determine your Variable Cost per unit (e.g., $5 for raw materials).
  3. Set your Selling Price per unit (e.g., $15).
  4. Subtract variable cost from price to get the contribution margin ($15 – $5 = $10).
  5. Divide fixed costs by that margin ($2,000 / $10 = 200 units). You need to sell 200 units to break even.

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Frequently Asked Questions (FAQ)

What happens if variable costs exceed price?
If your variable costs are higher than your price, you will lose money on every unit sold, and you can never reach a break-even point without lowering costs or raising prices.

Why are fixed costs important in a clear calculator?
Fixed costs represent your “barrier to entry.” High fixed costs require high sales volume to reach profitability.

Can I calculate the required price to break even?
Yes. By leaving the Price field empty and filling in the others, this calculator will solve for the minimum price required to cover your costs.

Is the Clear Calculator suitable for service businesses?
Absolutely. For services, “Quantity” might represent billable hours, and “Variable Cost” might include hourly wages or project-specific supplies.