Calculate exactly how many units you need to sell to turn a profit.
Rent, salaries, insurance, etc.
What the customer pays.
Materials, shipping, labor per unit.
Calculation Results
Break-Even Units:0
Break-Even Sales Revenue:$0.00
Contribution Margin:$0.00
Please ensure the sale price is higher than the variable cost.
Understanding Your Break-Even Point
The Break-Even Point (BEP) is the critical juncture where your total expenses and total revenue are equal. At this stage, your business is not making a profit, but it is also not incurring a loss. Every unit sold after this point contributes directly to your bottom line.
The Break-Even Formula
Break-Even Units = Total Fixed Costs / (Sale Price per Unit – Variable Cost per Unit)
Key Components
Fixed Costs: Expenses that remain constant regardless of sales volume, such as rent, administrative salaries, and equipment leases.
Variable Costs: Costs that fluctuate based on production levels, including raw materials, packaging, and direct labor.
Contribution Margin: This is the Sale Price minus the Variable Cost. It represents the amount of money available from each unit sold to cover fixed costs.
Real-World Example
Imagine you run a specialty candle business. Your fixed costs (studio rent and insurance) total $2,000 per month. You sell each candle for $25, and the materials/shipping for each candle (variable cost) total $10.
Your contribution margin is $15 ($25 – $10). To find your break-even point: $2,000 / $15 = 134 units. You must sell 134 candles every month just to cover your costs.
function calculateBreakEven() {
var fixedCosts = parseFloat(document.getElementById('fixedCosts').value);
var salesPrice = parseFloat(document.getElementById('salesPrice').value);
var variableCosts = parseFloat(document.getElementById('variableCosts').value);
var resultArea = document.getElementById('beResultArea');
var errorArea = document.getElementById('errorArea');
if (isNaN(fixedCosts) || isNaN(salesPrice) || isNaN(variableCosts)) {
alert("Please enter valid numbers in all fields.");
return;
}
if (salesPrice <= variableCosts) {
resultArea.style.display = 'none';
errorArea.style.display = 'block';
return;
}
errorArea.style.display = 'none';
var contributionMargin = salesPrice – variableCosts;
var breakEvenUnits = Math.ceil(fixedCosts / contributionMargin);
var breakEvenRevenue = breakEvenUnits * salesPrice;
document.getElementById('unitsResult').innerText = breakEvenUnits.toLocaleString() + " Units";
document.getElementById('revenueResult').innerText = "$" + breakEvenRevenue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('marginResult').innerText = "$" + contributionMargin.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
resultArea.style.display = 'block';
}