Break-even Revenue Table – Fixed Costs & Contribution Margin
Estimate break-even revenue across common fixed-cost and contribution-margin scenarios, then compare break-even units using contribution per sale.
Break-even revenue reference table
Select fixed costs in the first column and contribution margin ratio across the top. The cell shows the approximate revenue required for modeled operating profit to equal zero.
| Fixed costs | 10% contribution margin | 20% contribution margin | 25% contribution margin | 30% contribution margin | 40% contribution margin | 50% contribution margin | 60% contribution margin | 70% contribution margin |
|---|---|---|---|---|---|---|---|---|
| $5,000 | $50,000 | $25,000 | $20,000 | $16,667 | $12,500 | $10,000 | $8,333 | $7,143 |
| $10,000 | $100,000 | $50,000 | $40,000 | $33,333 | $25,000 | $20,000 | $16,667 | $14,286 |
| $25,000 | $250,000 | $125,000 | $100,000 | $83,333 | $62,500 | $50,000 | $41,667 | $35,714 |
| $50,000 | $500,000 | $250,000 | $200,000 | $166,667 | $125,000 | $100,000 | $83,333 | $71,429 |
| $100,000 | $1,000,000 | $500,000 | $400,000 | $333,333 | $250,000 | $200,000 | $166,667 | $142,857 |
| $250,000 | $2,500,000 | $1,250,000 | $1,000,000 | $833,333 | $625,000 | $500,000 | $416,667 | $357,143 |
Formula: break-even revenue = fixed costs ÷ contribution margin ratio.
Break-even units reference table
This second table uses contribution per unit. The results are rounded up to whole units because selling the lower whole number would still be below break-even.
| Fixed costs | $5 contribution / unit | $10 contribution / unit | $15 contribution / unit | $20 contribution / unit | $25 contribution / unit | $40 contribution / unit | $50 contribution / unit | $75 contribution / unit | $100 contribution / unit |
|---|---|---|---|---|---|---|---|---|---|
| $10,000 | 2,000 | 1,000 | 667 | 500 | 400 | 250 | 200 | 134 | 100 |
| $25,000 | 5,000 | 2,500 | 1,667 | 1,250 | 1,000 | 625 | 500 | 334 | 250 |
| $50,000 | 10,000 | 5,000 | 3,334 | 2,500 | 2,000 | 1,250 | 1,000 | 667 | 500 |
| $100,000 | 20,000 | 10,000 | 6,667 | 5,000 | 4,000 | 2,500 | 2,000 | 1,334 | 1,000 |
Formula: break-even units = fixed costs ÷ contribution per unit.
The two break-even formulas
Revenue-based
Useful for whole-business planning, services and mixed product portfolios.
Unit-based
Useful for products, jobs, hours and subscriptions with a clear unit contribution.
Example: $50,000 fixed costs at different contribution margins
| Contribution margin | Break-even revenue | Interpretation |
|---|---|---|
| 20% | $250,000 | Only $0.20 of each sales dollar contributes to fixed costs. |
| 30% | $166,667 | $0.30 of each sales dollar contributes. |
| 40% | $125,000 | $0.40 of each sales dollar contributes. |
| 50% | $100,000 | Half of sales revenue remains after variable costs. |
| 60% | $83,333 | Higher contribution sharply lowers the required revenue. |
This is why a small change in contribution margin can materially change the sales burden required to cover the same fixed-cost base.
How to calculate contribution margin ratio
If sales are $200,000 and variable costs are $120,000, the ratio is 40%. With $50,000 fixed costs, break-even revenue is $125,000.
Use the Contribution Margin Calculator when you need the ratio from your own data.
How to calculate contribution per unit
If price is $70 and variable cost is $45, contribution is $25. With $50,000 fixed costs, break-even is $50,000 ÷ $25 = 2,000 units.
Why fixed costs matter as much as margin
Two businesses can have the same contribution margin and very different break-even requirements. At 40% contribution margin, $10,000 fixed costs require $25,000 revenue, while $100,000 fixed costs require $250,000 revenue.
Typical fixed costs can include rent, fixed salaries, insurance, subscriptions, software and other expenses that do not change with each additional sale inside the modeled range.
Step-fixed costs can create another break-even threshold
A simple break-even table assumes fixed costs remain fixed. In reality, reaching higher volume may require another employee, machine, warehouse, vehicle, shift or software tier.
If fixed costs are $50,000 at current capacity but rise to $70,000 after expansion, a 40% contribution margin changes break-even revenue from $125,000 to $175,000. Model both ranges separately rather than using one fixed-cost number for every sales level.
Discounts usually push break-even higher
If price falls while variable cost remains unchanged, contribution per sale falls. Example: $100 selling price, $60 variable cost and $60,000 fixed costs produce $40 contribution and 1,500 break-even units. A 10% discount lowers contribution to $30 and raises break-even to 2,000 units.
Use the Discount vs Required Sales Increase Table or the Discount Profit Calculator for promotion scenarios.
Break-even is not a target profit
Break-even means zero modeled operating profit. To reach a positive profit target:
With $50,000 fixed costs, a $25,000 target profit and 40% contribution margin, required revenue is $187,500.
Use the Target Profit Calculator or Revenue Target Calculator for that next step.
Multi-product businesses need a realistic sales mix
A business with many products can use a weighted average contribution margin ratio, but only if that average reflects the expected sales mix. If high-contribution products become a smaller share of sales, average contribution falls and break-even revenue rises.
Does your break-even result look realistic?
- Capacity: can the business deliver the required sales volume?
- Demand: has the market supported sales near that threshold?
- Price: does the model use actual realized price after normal discounts?
- Variable cost: are all relevant sales-dependent costs included?
- Fixed-cost steps: would reaching the threshold trigger new staff, equipment or premises?
Common break-even table mistakes
- Using gross margin when contribution margin is the relevant measure.
- Mixing monthly fixed costs with annual revenue.
- Using list price instead of realized selling price.
- Ignoring step-fixed costs at higher volume.
- Using an average contribution margin that no longer matches sales mix.
- Rounding indivisible units down.
- Assuming a mathematically reachable break-even proves demand exists.
- Confusing break-even with a positive target-profit goal.
For business and economics students
Exercise 1
Fixed costs = $30,000, contribution margin = 25%. Find break-even revenue.
Show answer
$30,000 ÷ 0.25 = $120,000.
Exercise 2
Fixed costs = $24,000, contribution per unit = $15. Find break-even units.
Show answer
$24,000 ÷ $15 = 1,600 units.
Exercise 3
Fixed costs rise from $40,000 to $55,000 while contribution margin stays 50%. How much does break-even revenue rise?
Show answer
Old = $80,000. New = $110,000. Increase = $30,000.
Move from reference values to your exact break-even
Use real fixed costs, prices, variable costs and planned volume for the final decision.