With what? parts imported from China xD,
Jokes.
Taiwan*
There are so many fucking dodgy computer shops/builders/part suppliers in Australia it is unbelievable.
http://www.itestate.com.au/products_detail.asp?code=PD00003904
Look at that. Noway you can legitimately build that for $599 +- 100.
Actually that PC can be built for the price stated. Using centrecom.com.au as a reference, I worked out that:
Processor -AMD AM2 Athlon 64 3800+ S940 - $80
Mainboard -GA-M52S-S3P - $100
Memory -2GB(2x1024MB)DDR2 PC6400 800Mhz RAM - $65
HDD -250GB SATA-300 Hard disk drive 7200rpm - $95
Video Card -nVidia 8600GT 512MB DirectX 10(VGA/DVI port) - $140
Optical Drive-20x Dual Layer DVD-Buner drive (Black) - $40
ATX case -Gaming Case (250mm Fan on side) with 500W Power Supply - $75
6 x USB 2.0 Port (MAX)
^ I'm assuming they're using generic brands for the RAM, VGA card, optical drive and case
With Windows Vista Home itself costing over $300, I doubt your friend could build it for that cheap, you'd need to invest at least $2000 for a 'top spec' computer.