DPR Readiness
Break-Even Calculator
Find the level of sales at which the project covers all its costs, and how far expected sales are from that point. The defaults are examples only; replace them with your project's figures.
Contribution per unit
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P/V ratio
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Accounting break-even (units)
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Break-even sales value
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Break-even as % of capacity
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Cash break-even (units)
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Cash break-even, % capacity
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Margin of safety (units)
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Margin of safety, % of sales
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Formula used
| Measure | How it is calculated |
|---|---|
| Contribution per unit | Selling price − variable cost per unit |
| P/V ratio | Contribution per unit ÷ selling price |
| Accounting break-even (units) | Fixed costs ÷ contribution per unit |
| Cash break-even (units) | (Fixed costs − non-cash fixed costs such as depreciation) ÷ contribution per unit |
| Break-even as % of capacity | Break-even units ÷ installed capacity × 100 |
| Margin of safety | Expected sales − break-even sales, in units and as % of expected sales |
How lenders use break-even
Lenders compare the break-even level with the capacity utilisation assumed in your projections. A project that breaks even only near full capacity has little room for a slow start or a price fall. There is no single standard; what is acceptable depends on the sector and the lender. For a multi-product unit, use a weighted average price and variable cost, or compute break-even in sales value using the P/V ratio.
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