breakeven_margin
Calculate cost-volume-profit break-even thresholds in units and revenue, contribution margin ratio, operational margin of safety, and degree of operating leverage (DOL).
Behavior: Deterministic, idempotent calculation with zero external side effects. Computes Unit Contribution Margin = unitPrice - unitVariableCost; Contribution Margin Ratio = CM / unitPrice; Break-Even Units = fixedCosts / CM; Break-Even Revenue = Break-Even Units * unitPrice. If expected units sold is provided, computes Margin of Safety = (expectedUnits - breakEvenUnits) / expectedUnits and Degree of Operating Leverage. Returns detailed breakdown.
Usage Guidelines: Use for pricing strategy, manufacturing and SaaS unit economics, and operational risk appraisal. Do not use for hourly freelance billing rate minimums; use billable_floor instead.
Input Schema
| Name | Required | Description | Default |
|---|---|---|---|
| unitPrice | Yes | Selling price per individual product or service unit in currency units. Must be greater than unitVariableCost. | |
| fixedCosts | Yes | Total periodic fixed operating overhead costs in currency units (rent, salaries, software). Must be positive. | |
| unitVariableCost | Yes | Direct variable cost incurred per unit produced or delivered in currency units. Must be non-negative. | |
| expectedUnitsSold | No | Projected sales volume in units to evaluate operational margin of safety and operating leverage. |