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Definitions
- Variable unit cost
- Cost associated with producing an additional unit.
- Fixed cost
- The sum of all costs required to produce any product. This amount does not change as production increases or decreases.
- Expected unit sales
- The number of units that are expected to be sold.
- Price per unit
- Price you will be able to receive per unit.
- Total variable costs
- The product of units produced and variable unit cost (example 10 units at $5 variable cost produces a total variable cost of $50).
- Total costs
- Sum of fixed costs and variable costs.
- Total revenue
- Product of price and expected sale unit sales (example 10 units at $10 equals $100 total revenue).
- Profit
- Total revenue minus total costs.
- Break-even
- Number of units required to sell to make a profit of zero.
Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.