How to Find the Break-Even Point in Excel

Work out how many candles a small maker must sell to cover fixed costs, the break-even revenue, and the units for a profit goal.

You will learn to

• Calculate break-even units
• Calculate break-even revenue
• Find the units needed for a target profit

How it works

The break-even point is where sales exactly cover costs. Each unit contributes its price minus its variable cost (the contribution margin) toward fixed costs, so break-even units = fixed costs ÷ (price − variable cost).

Break-even revenue = fixed costs ÷ contribution margin ratio, where the ratio is (price − variable cost) ÷ price. To find the volume for a profit goal, add the target profit to the fixed costs before dividing, and round up — you can’t sell part of a unit.

=B2/(B3-B4)