Formula / Rule
Contribution per unit = SP − VC; BEP units = Fixed / Contribution per unit
Memory aid
Fixed costs are sunk for next-unit decisions; only variable matters.
⚠ Most common mistake
Allocating fixed overhead into per-unit cost for short-run pricing decisions.
Go deeper
Need more than a one-liner? Pick a view — first time generates with AI, after that it’s instant for everyone.