Break-Even Point
Fixed Costs ÷ (Selling Price − Variable Cost per Unit)
Example / 예시
- Fixed costs: €10,000/month
- Selling price: €50/unit
- Variable cost: €30/unit
Contribution margin = €50 − €30 = €20
Break-even = €10,000 ÷ €20 = 500 units/month
In Revenue
Margin % = 20 ÷ 50 = 40% Break-even = €10,000 ÷ 0.40 = €25,000
Interpretation
- Below break-even: loss
- At break-even: no profit/loss
- Above break-even: profit
Applications
- Business planning
- Pricing decisions
- New product evaluation
- Risk analysis