# How to Calculate Break Even Point?

How do you find breakeven point?

## Breakeven Point Calculation

Breakeven point is the term widely used in Finance to analyse the point at which the total expense of a company equals the total revenue. Use our simple step by step tutorial and learn how to calculate break even point. Break even point Formula
Break even point = Fixed cost / Gross Profit Margin
Gross Profit Margin = Sales price - Variable cost Step 1:
Assume, XYZ company is selling tv at a fixed cost of Rs. 65,000 per month. Sales price and variable cost of the company is Rs.2000 and Rs.500 respectively. Find the break even point?
Fixed cost - Rs. 65,000
Sales Price - Rs. 2000
Variable Price - Rs. 500 Step 2: We have to find the Gross profit margin cost.
Gross Profit Margin = Sales price - Variable cost
=2000 - 500 = Rs. 1500
Gross Profit Margin = Rs. 1500 Step 3: To find the Break even point of the company, substitute the obtained values in the formula.
Break even point = Fixed cost / Gross Profit Margin
=65,000 / 1500
Break even point = 43 Thus, the company has to sell 43 TVs to cover their total expenses, fixed and variable cost.