Break-Even Point
The exact number of sales needed to cover all costs — neither profit nor loss.
Formula
Break-Even Point = Fixed Costs ÷ (Selling Price − Variable Cost per Unit)
Real World
Greggs calculated that each sausage roll sold for £1.10 with a variable cost of 40p, meaning every unit contributed 70p toward fixed costs of £700,000 — requiring 1 million unit sales to break even.
Exam Focus
Always show the full calculation; missing contribution per unit step loses a method mark even if the final answer is correct.
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