iMac cost estimated at $898

El Segundo (CA) - It's no secret that owning an Apple product is synonym to paying a premium price. But we also know that Apple heavily invests into product design and the components it builds into its devices. And if we believe iSuppli's most recent teardown analysis, this trend continues with the Intel-Macs - the new iMac's production is everything else than cheap.

The market research firm estimates that Apple spends $898 on every entry-level iMac for hardware, manufacturing and testing. This amount - which is already higher than many mainstream PC users are willing to spend for their PC - does not include shipping cost, handbook, mouse and keyboard.

Intel's Core Duo T2400 processor and 945PM chipset account for 35% of the bill of materials. Priced at $265 and $45, respectively, iSuppli indicates that Apple receives a slight discount from Intel for these components: The CPU/chipset combination is listed for $359. However, the Intel part includes the 3945ABG wireless chipset, while Apple uses its own Wi-Fi technology.

The remaining $588 are consumed by the 17" LCD panel provided by LG.Philips, Maxtor's 160 GB harddrive, ATI's X1600 graphics chip and DDR memory supplied by Samsung. iSuppli estimates that Apple spends about $25 for assembly and testing. Retail price for the entry-level iMac is $1299, which indicates that Apple's margin of the iMac is between 20 and 25%, if an industry average of 7% marketing cost and added shipping expenses are considered - and if iSuppli's numbers are close.