250 is the example result. A positive unit contribution is required to cover fixed cost. Fractional units describe the mathematical threshold; whole-item sales need rounding upward.
Estimate the unit sales needed to cover fixed costs. The model uses one selling price and one variable cost per unit. It suits a single product or a simplified offer with consistent unit economics.
Contribution sets the sales requirement
Selling price less variable cost is contribution per unit (the amount available to cover fixed costs). Divide fixed costs by that contribution to find the modeled break-even quantity. Use a matching period for fixed costs and your sales plan. Keep tax and price treatment consistent across the inputs.
Turn the number into an operating target
If you sell whole units, round a fractional break-even quantity up before setting a minimum target. Then compare that target with demand, production capacity and delivery constraints. A calculated volume is not evidence that enough buyers exist or that the business can deliver it.
Recognise when one unit model is insufficient
Several products with different contributions require a sales-mix model. Volume discounts and costs that change in steps can also alter the result. If price is no higher than variable cost, additional units cannot cover positive fixed costs under these assumptions.
Example with the supplied inputs
Fixed costs: 10000; Selling price per unit: 100; Variable cost per unit: 60. Result: 250. The values are illustrative.
Compare one changed input
Fixed costs changes from 10000 to 11000. The result becomes 275. All other inputs remain fixed.
Calculation rule
Result = (([Fixed costs]) ÷ ([Selling price per unit] − [Variable cost per unit]))
Inputs and output
| Input | Example value | Entry convention |
|---|---|---|
| Fixed costs | 10000 | Use fixed costs on the currency and period basis shown by the formula. Keep gross amounts, net amounts and unit amounts distinct; the page does not fetch a price or exchange rate. |
| Selling price per unit | 100 | Use selling price per unit on the currency and period basis shown by the formula. Keep gross amounts, net amounts and unit amounts distinct; the page does not fetch a price or exchange rate. |
| Variable cost per unit | 60 | Use variable cost per unit on the currency and period basis shown by the formula. Keep gross amounts, net amounts and unit amounts distinct; the page does not fetch a price or exchange rate. |
Output: 250 is the example result. A positive unit contribution is required to cover fixed cost. Fractional units describe the mathematical threshold; whole-item sales need rounding upward. Use the formula to distinguish a cash amount, count, percentage or ratio.
How to use the page
Collect the inputs
Gather Fixed costs, Selling price per unit, Variable cost per unit. Use one period and the units shown in the form.
Run the calculation
Enter the values and select the action. The calculation rule above explains how the inputs produce the result.
Compare a scenario
Change Fixed costs on its own, keeping the other inputs fixed. Read both results before changing another assumption.
Worked example
With the example inputs listed above, the result is 250.
Change Fixed costs from 10000 to 11000 while keeping every other value fixed. The result becomes 275. This comparison isolates that input; it does not forecast how other variables will respond.
Check the stated formula, units and limits before using the result in a decision.
Keep the displayed formula, input units and model scope with the result. Corrections or questions can be sent through the request section on this page.