Unit fixed costs decrease with your sales, while unit variable costs are constant with sales; so then, as sales increase turnover allows for covering the variable costs (whenever the selling price exceeds the unit variable cost) and part of the fixed costs. The break-even point is the level of sales when turnover will just cover both costs, leading the company to abandon loses.
The break-even point is the level of sales which is a minimum for the company to start making a profit. To obtain this in terms of units and currency, input the figures for your fixed costs, the variable cost and the unit price.
This calculator indicates you the number of units that allow your company or project to reach break-even. Use it to simulate different scenarios of costs and prices.
The simulation screen can be used to find out the different possibilities for reducing the break-even point: price increase, variable cost reduction, fixed cost reduction.
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