How do you calculate the break-even point?

Break-Even Units = Fixed Costs ÷ (Selling Price − Variable Cost per Unit). The denominator is the Contribution Margin per Unit. Break-Even Revenue = Fixed Costs ÷ Contribution Margin Ratio. Example: Fixed costs $50,000, price $75, variable cost $30 → CM = $45 → Break-even = 50,000 ÷ 45 = 1,112 units.

What is contribution margin?

Contribution Margin = Revenue − Variable Costs. It represents the amount each unit sold contributes toward covering fixed costs and then generating profit. A contribution margin ratio of 60% means 60 cents of every dollar goes to fixed costs/profit. UK management accountants and US Cost Accounting Standards both use contribution margin analysis for break-even and pricing decisions.

How does break-even analysis differ for UK Start Up Loans vs US SBA loans?

Both programs require break-even analysis as part of the business plan. UK Start Up Loans (government-backed, fixed 6%, max £25K) require a 12-month cash flow forecast showing break-even. US SBA 7(a) loans require 3 years of projections showing the business can service the debt. Canadian BDC loans require a debt service coverage ratio of 1.25× minimum, which is essentially a break-even with margin.

📊 Fixed vs Variable Costs 💼 Contribution Margin 🇺🇸 SBA · 🇬🇧 Start Up Loans

Break-Even Calculator

Find the minimum units you need to sell to cover all costs. Essential for business plans, loan applications, and pricing decisions. Used by US SBA, UK Start Up Loans, and Canadian BDC borrowers.

Quick Answer

Break-Even Units = Fixed Costs ÷ (Price − Variable Cost). Fixed costs $50K, price $75, variable cost $30 → Contribution Margin $45 → Break-even = 1,112 units. Every unit above break-even generates $45 of profit.

Fixed Costs ($)

Selling Price per Unit ($)

Variable Cost per Unit ($)

Break-Even Analysis for Business Loans by Country

Program	Break-Even Requirement	Max Loan
🇺🇸 US SBA 7(a)	3-year projection showing debt service coverage	$5M
🇬🇧 UK Start Up Loan	12-month cash flow showing break-even	£25,000
🇨🇦 BDC Business Loan	DSCR ≥1.25× (break-even + 25% margin)	CA$350K unsecured
🇦🇺 AU Small Business Loan	Positive cash flow projection, ≥6 months trading	A$250K
🇩🇪 KfW (Germany)	Business plan with Gewinnschwelle (break-even)	€25M

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Cite this page APA · MLA · BibTeX

APA

WorldCalculators.org. (n.d.). Break-Even Calculator — Units, Revenue & Contribution Margin. https://worldcalculators.org/calculators/break-even/

MLA

“Break-Even Calculator — Units, Revenue & Contribution Margin.” WorldCalculators.org, worldcalculators.org/calculators/break-even/.

BibTeX

@misc{worldcalculatorscalculatorsbreakeven,
  title        = {Break-Even Calculator — Units, Revenue & Contribution Margin},
  author       = {{WorldCalculators.org}},
  year         = {n.d.},
  howpublished = {\url{https://worldcalculators.org/calculators/break-even/}}
}

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