Financial Calculators
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Break-even Units
12,000
Break-even Revenue
$300,000
Margin of Safety
25.0%
Units for Target Profit
17,000
Each unit contributes $10.00 toward fixed costs (a 40.0% margin). At 16,000 units sold, operating profit is $40,000. Sales can fall 25.0% (4,000 units) before losses begin. To earn $50,000 above fixed costs, sell 17,000 units.
Revenue vs total cost — the break-even crossing
Left of the crossing point you lose money; right of it, every unit adds its contribution to profit.
● Break-even at 12,000 units ($300,000 of revenue)