Calculate the break-even point in units and revenue to determine when your business becomes profitable.
The break-even point is the level of sales where total revenue equals total costs. At this point, the business neither makes a profit nor incurs a loss.
Break Even Units = Fixed Costs ÷ (Selling Price − Variable Cost)
Where:
If your fixed costs are ₹50,000, selling price is ₹100, and variable cost is ₹40:
It helps businesses determine the minimum sales required to cover all costs and avoid losses.
After reaching break-even, every additional sale contributes to profit.
Yes. Changes in cost structure, selling price, or production costs will affect the break-even point.