Donaldson R F Break-Even Calculator
How many units (and how much revenue) it takes to cover your costs, before you start making a profit.
How this is worked out
Each unit sold contributes price − variable cost towards covering your fixed costs (rent, salaries, insurance — costs that don't change with how much you sell); that difference is the contribution margin. Dividing fixed costs by the contribution margin gives the break-even point: the number of units where total revenue exactly equals total costs, with no profit or loss yet. Sell fewer than that and you're making a loss; sell more and every extra unit's contribution margin becomes pure profit.
Frequently asked questions
What counts as a fixed cost versus a variable cost?
Fixed costs stay the same regardless of sales volume (rent, a salaried employee, software subscriptions); variable costs scale with each unit sold (materials, packaging, a sales commission per sale, payment processing fees). Some costs are a mix of both and need splitting into their fixed and variable parts for an accurate break-even figure.
What if the price is lower than the variable cost?
Then each sale loses money regardless of volume — there's no break-even point to reach, because the contribution margin is negative; the price needs to go up, or the variable cost down, before break-even is possible at all.
Related tools: Markup & Margin Calculator, ROI Calculator, Freelance Rate Calculator.
Source / Last verified: standard managerial-accounting break-even formula (fixed costs ÷ contribution margin) — read/checked 1 October 2026.