How do they calculate the price to manufacture? Do they allocate all the research, development, and corporate overhead to each iPhone? If you don’t charge your overhead back to your actual products that produce revenue, your accounting is not really accurate.
Your answer is no but the whole idea is to make a lot of money via sales and larger margins so that investments in research plus overhead can be recouped. Then you make profits, after taxes.
They should be adding the cost of the bill of materials and the cost to assemble. That’s the manufacturing cost.
Development costs cover the software, hardware, and other one time costs that go into realizing a product.
Thank you for pointing this out. The huge majority of people have NO CLUE of how to arrive at a realistic cost of production.
The problem there is that on a per-unit basis, the R&D overhead drops as the number of units produced increases. If your R&D is $1M, and you produce 10 units, that's $100K each. If you produce a million units, that's a buck each. (hypothetical numbers, obviously).
So, yeah, it's tough to come up with a meaningful cost to produce for something like an iPhone, or any other complex product. And it's easy to fold some bias into those numbers, which may well be true in this case.