The parts of a PC: G6JPG recommendations as of 2004-1-4.

A PC comprises the following. The column headed "basic system" is what I - as of now - think is the minimum it's economic to buy (i. e. you might be able to save a bit, but I think it would compromise your PC for negligible saving). The column headed "costing" is the lowest price I've seen (in about my last three visits to computer fairs) for what I recommend, so allow at least 10% more.
The "second-hand" column is the minimum I'd say it was worth bothering with - though this does depend on what you want a PC for; a 386-based system with 4M of memory can be adequate for word processing, or with 16 (or at a pinch 8) for much web surfing. My specification is based on what I think is a reasonable mix (specifically excluding games - in fact that applies to my new specification as well, as the latest games need the latest hardware, and then some).
component basic system - G6JPG recommended minimum specification costingcomments second-hand
necessary to work at all: 
case (with power supply) midi ATX,
350W supply, front sockets, 4 + 2 bays
£24
midi should mean at least 3 5¼" bays.
any; ATX better, slimline worse
motherboardSEE BELOW £35 to over £100 (minimal socket 370 or socket A or P4, with sound) Pentium 233MMX system
processor£35 (Intel Pentium iii, 866 MHz)
(main) memory256 megabytes
of PC133
£21or perhaps 512 (£37) 48
hard drive60 gigabytes£50
4 to 6 suffices; it's just not economical to buy less than about 60, or 80 (£59).
1½ to 2 gigabytes
(4 better)
monitor17" SVGA colour
(non-CRT is nice!)
£85 (15" non-CRT: £180) (17" £35 second-hand)any SVGA colour
graphics hardware2M suffices …
(TV-out is useful)
(8M TV-out was £20) … but probably best to go for 8 or 16M.(any)
operating systemWindows 98SE£35 Or xp (home, £79.99; professional, £120) Windows 95 version 2.x
keyboard(as required)£3 Probably can't find (new) other than W98any (that fits)
cablesas needed(too much) Check: mains (monitor, PC, scanner/printer etc.), printer leads (especially if buying switchboxes), video if not part of monitor, internal ("Y") power leads (if case hasn't enough), CD audio (to sound card), HD/FD ribbon cables. as required
you'd almost certainly want these:
floppy drive3.5" 1.44 megabyte£5.50 Needed for data exchanges.3.5" 1.44 megabyte
CD facility
(DVD optional)
BURn-proof CD-RW drive
(or combined with DVD player)
£28 (52×24×52)
(£55 [48×24×48] with DVD player)
DVD writers from £s;89 (which do CDs too) at least 4× CD-ROM drive
mousePS/2£3 (I personally prefer a trackerball.)any (that fits)
sound hardware(on motherboard) 0 (if on motherboard) Higher-spec. sound cards give little extra for most people.any
speakersmains powered£5 Try to get T-piece mains lead (saves a mains socket). any or none
printerHP640C£59 (I just like HP printers. YMMV.)
MoDemV90 internal hardware £23.49 external Software ones use some processor power, which can be more trouble. none or external
further additions:
other software (i. e. as well as the operating system): for ease of transfer of your work to other people, the Microsoft Office suite (Word, Excel, etc.) seems to have the lion's share of the market. The 97 version seems able to do all I've ever wanted; the Works suite is a slightly cheaper alternative and needs considerably less in the way of PC power, and, from the "99" version, includes the only part of Office most people use - the word processor, Word - so may be worth looking out for. As for other software, it depends what you want to do: some should come with most of the peripherals you might buy (scanner, camera, CD-RW drive), and for the rest, much is available from the internet and/or magazine cover discs.
CD-R or CD-RW drive: the cheapest (though not necessarily the easiest to use) system around for backing up large amounts of data; also, you can make your own data CD-ROMs and audio CDs. Having a (read-only) CD-ROM drive as well as a CD-RW drive is less of an advantage than it might appear, especially for copying audio CDs (because many read-only CD-ROM drives are not really capable of digital audio extraction [even though they can play audio CDs]).
USB ("pen") drives: A very easy way to transfer files between (Windows 98 or later) PCs; £45 for a 256M capacity one. For somewhat more money, you can get ones that can alos play any .mp3 files you load into them.
DVD drive: a DVD-ROM drive is nice to have, either to play movies or to be able to read data that comes on DVD-ROMs rather than CDs. The most convenient (and cheapest) way to provide DVD facility is via a so-called "combo" drive, providing DVD playing in the same device as CD (re)writing and reading; the disadvantages of early combo drives have now been eliminated. [The playing of movies will, in some older computers, be smoother with a hardware card for the purpose (replaces, or works with, the original graphics card)]. DVD-RAM (writable) drives are becoming cheaper (from £89), though there are still various different format specifications that haven't settled down yet. Some drives cover several formats.
scanner (and OCR software?): Nice to have, and from £11.74. USB ones have the potential to scan faster. OCR software isn't really necessary unless you want to transcribe a lot of printed material - though (a "lite" version) often comes with the scanner anyway.
digital still camera: from £20 or £35 to hundreds. Most can also be used as a "webcam", though the converse isn't so.
TV and radio cards (receive radio and/or television via your PC; most can also grab video). Can have multiple-channel monitoring, NICAM stereo sound, remote control (all have teletext) … from thirty-odd pounds for a basic one. (From £79 for one for digital [terrestrial] TV.)
FireWire cards allow direct input from digital camcorders (and other peripherals with a FireWire interface); from £18.
network cards (for connecting PCs together in a network - from £6 per PC [if just 2 PCs, just a laplink cable - £3.50 - works fine]).
USB cards (from £9) provide USB connectivity (needed for many peripherals - virtually all digital cameras, most scanners, and some printers, for example) for older PCs. (Modern ones include USB ports on the motherboard.)

PROCESSOR AND MOTHERBOARD:

Unfortunately, there are currently at least three different incompatible processor shapes; as a result, it is not really that possible to future-proof a system in this area, as it is far from clear which (if any!) will prevail, so it is necessary to decide what you want, and go for it. Fortunately, a motherboard change is less difficult than it used to be, so if you later find you've backed the wrong horse and have to upgrade, it's not the end of the world - though expect to have to change some of your older hardware too, and maybe to have to start from a blank disc to reduce problems (i. e. be prepared to have to reinstall everything).

Processor speed is also a matter of argument - especially as it isn't the same between families: a K6-III outperformed a K6-II of the same (or even slightly faster) speed, for example. In fact, the figures is the names of the Athlon range of processors reflect the speed of the Intel processors AMD claim the Athlons are equivalent to; the actual clock speed they use is in fact lower. On the whole, about 950 megahertz (or 1 gigahertz) is the minimum I'd recommend at the moment - not that less won't suffice for most purposes, just that a say 800 system is likely to have other more elderly or lower-specified components in it (smaller hard drive, possibly slower memory, and so on).

The currently available processor shapes (and thus motherboard styles) are:

So, to summarise: motherboards that can take processors from either of the major manufacturers are no more, since AMD stopped making socket 7 processors. A socket 7 system is a decision not to intend to upgrade - though possibly still usable (should be offered at a very knock-down price though). Sockets 370 (Intel), A (AMD), and 478 (Intel) are the main choices. Socket 370 gave a wide range of choice (mainly from Intel, though there is the Cyrix MIII), but is now obsolescent, socket A lets you choose from the AMD Duron and Athlon ranges, and socket 478 lets you use a recent Celeron or Pentium 4 (socket 423 didn't last long, and you might even have to pay a premium for a P4 to fit it - if you can find one at all).