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Break-Even Point Formula

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Break-even (or break even) is the point of balance making neither a profit nor a loss. Check FAQs

BEP = \frac{FC}{CM}

BEP - Break Even Point?FC - Fixed Costs?CM - Contribution Margin per Unit?

Break-Even Point Example

With values

With units

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Here is how the Break-Even Point equation looks like with Values.

Here is how the Break-Even Point equation looks like with Units.

Here is how the Break-Even Point equation looks like.

50 = \frac{2000}{40}

50 = \frac{2000}{40}

50 = \frac{2000}{40}

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Break-Even Point Solution

Follow our step by step solution on how to calculate Break-Even Point?

FIRST Step Consider the formula

BEP = \frac{FC}{CM}

Next Step Substitute values of Variables

∴

BEP = \frac{2000}{40}

Next Step Prepare to Evaluate

∴

BEP = \frac{2000}{40}

LAST Step Evaluate

∴

BEP = 50

Break-Even Point Formula Elements

Variables

Break Even Point

Break-even (or break even) is the point of balance making neither a profit nor a loss.

Symbol: BEP

Measurement: NAUnit: Unitless

Note: Value can be positive or negative.

Formulas to find Break Even Point

Fixed Costs

Fixed costs are the cost that does not change with an increase or decrease in the number of goods or services produced or sold.

Symbol: FC

Measurement: NAUnit: Unitless

Note: Value can be positive or negative.

Formulas to find Fixed Costs

Contribution Margin per Unit

The Contribution Margin per Unit represents the incremental money generated for each product/unit sold after deducting the variable portion of the firm's costs.

Symbol: CM

Measurement: NAUnit: Unitless

Note: Value can be positive or negative.

Formulas to find Contribution Margin per Unit

Other formulas in Important Formulas of Business category

Go Return on Capital Employed

ROCE = (\frac{EBIT}{TA - CL}) \cdot 100

Go Solvency Ratio

SR = \frac{SF \cdot 100}{TA}

Go Economic Order Quantity

EOQ = (\frac{2 \cdot Cf \cdot Demand}{C h}) \cdot (\frac{1}{2})

Go Percentage off

% Off = 1 - (\frac{SP}{OP})

How to Evaluate Break-Even Point?

Break-Even Point evaluator uses Break Even Point = Fixed Costs/Contribution Margin per Unit to evaluate the Break Even Point, Break-Even Point (or break-even) is the point of balance making neither a profit nor a loss. Break Even Point is denoted by BEP symbol.

How to evaluate Break-Even Point using this online evaluator? To use this online evaluator for Break-Even Point, enter Fixed Costs (FC) & Contribution Margin per Unit (CM) and hit the calculate button.

FAQs on Break-Even Point

What is the formula to find Break-Even Point?

The formula of Break-Even Point is expressed as Break Even Point = Fixed Costs/Contribution Margin per Unit. Here is an example- 50 = 2000/40.

How to calculate Break-Even Point?

With Fixed Costs (FC) & Contribution Margin per Unit (CM) we can find Break-Even Point using the formula - Break Even Point = Fixed Costs/Contribution Margin per Unit.

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Break-Even Point Formula

Break-Even Point Example

Break-Even Point Solution

Break-Even Point Formula Elements

Other formulas in Important Formulas of Business category

How to Evaluate Break-Even Point?

FAQs on Break-Even Point

Variable Name