How this calculation works
Break-even volume is the number of units whose combined contribution covers a fixed cost budget. Separate costs that rise with every sale from costs incurred for the period regardless of volume. This distinction matters more than the selling price alone: a product can generate revenue while contributing too little to cover rent, equipment or staffing.
Worked example
This example uses illustrative inputs. Your current result is shown above.
With ₹1,00,100 fixed costs, a ₹500 selling price and ₹300 variable cost, each unit contributes ₹200. ₹1,00,100 ÷ ₹200 = 500.5, so 501 whole units are needed. Their revenue is ₹2,50,500 and contribution ₹1,00,200, covering fixed costs by ₹100.
Assumptions and limits
- Fixed costs and projected unit sales cover the same reporting period.
- Selling price and variable cost stay constant across units; capacity limits, bulk discounts and multiple-product sales mixes are excluded.
Questions people ask
Why are units rounded upward?
A fraction of a whole unit cannot cover the remaining fixed cost when items are indivisible. The reported revenue uses the rounded unit count.
What if variable cost equals selling price?
Each sale then contributes nothing toward fixed costs. Increasing volume cannot create break-even under those assumptions.