Break-Even Calculator: Break-Even Quantity and Sales, Profit and Margin of Safety

How much you must sell to cover your costs.

Calculated from standard textbook formulas, with every step shown. The formulas are fixed, so the working does not need checking: what matters is the numbers you type in. Use these calculators only if you are competent to choose the inputs (loads, material strength, dimensions, supports) and check your units and assumptions. For learning and checking your own working: design and sign-off are for a qualified engineer. Drafting Central does not store the numbers you type.

How this calculator works

Enter the fixed costs, the price and the variable cost per unit.

Enter the planned quantity.

The calculator gives the break-even point, the profit and the margin of safety.

Formulas used

  • Q_{BE} = \frac{FC}{p - v}
  • S_{BE} = Q_{BE}\,p
  • \text{Margin of safety} = \frac{Q - Q_{BE}}{Q}

Worked example

With the default numbers in the calculator above:

  1. Contribution margin per unit: 10.00 dollars
  2. Break-even quantity: 5000 units
  3. Break-even sales: 125000.00 dollars
  4. Profit at the planned quantity: 30000.00 dollars
  5. Margin of safety: 37.5 %

Change the numbers in the calculator to see the full working, every step, for your own case.

Common questions

What is the break-even point?

The quantity at which total sales equal total costs, so profit is zero.

What is the contribution margin?

The selling price minus the variable cost per unit. It is what each unit contributes toward the fixed costs.

What is the margin of safety?

How far sales can fall below the plan before the business starts to make a loss.

Related calculators

Got a question about this? Ask an engineering question and get a plain-language answer with references.

Further reading: Any engineering economics or accounting text (cost-volume-profit analysis).

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