For example, for the base iPad model, ($509 - $290.50)/$509 is 42.9 percent

$509?
I thought it was selling for $499.
Why the difference?

Ok makes sense.

The Margin is great, far better I’ll wager than any NetBook maker or that Amazon gets on a Kindle.

We now have stock analyst guessing how much parts cost. The A4 SOC most likely contains the Application processor, Video Processor and DSP on a single die.  It looks like he took the iphone price guess and made some assumptions.  Apple’s cost on the SOC depends on the die size and yield once they amortize the design cost.  They are paying someone probably Samsung to Fab the chip but there per unit cost are probably closer to $10 rather then the $25 in this estimate but then Apple has to pay the designers wether they build 1 or 100M so they better get making chips.  Here is an easy guess the BOM is 50% of the retail cost.  Lot less detail but then you can go have a drink at 4:30 instead of searching for all this parts pricing info.

Of course, the retail price is $499, but analysts have a magical way of accounting for all kinds of costs—in this case an implied carrier subsidy that folds into his spreadsheet analysis.

The iPad isn’t subsidized by a carrier, so that really doesn’t apply here.

These numbers are meaningless because the cost amongst the already pointed out omissions doesn’t include development cost. If Apple spends 100 million in development costs before the product is released, the profit margin is meaningless until that outlay of initial development cost is paid.

  Remember, however, that the total cost of the device does not include, for example, shipping from China, packaging, warranty service, telephone support, and marketing.

Or assembly. Somebody has to put the thing together…

Or developing and maintaining the OS.

Or distribution costs.

Or helping cover the salaries of 30,000+ employees.

Etc etc.

Or advertising.
OTOH I almost everything else associated with the Ipad including apple care, higher priced models, Itunes store, apps store,accessories have much higher margins.