A number of people have written to AppCraver asking how to create a custom ringtone on the iPhone. It's easy, but not very well documented. Here are the steps:
1. Go to iTunes and open your Music library. In the second column, some of the tracks will have a little bell next to them, indicating a ringtone is available for that track. To see all available ringtones, sort by those with a bell by clicking on the top of the second column.
2. Now move the 15 second ringtone selection by moving the blue selection area to the right.
4. Now connect the iPhone to your Mac or PC. When the iPhone shows up as a device in iTunes drag the ringtone on top of the "iPhone icon".
5. Now sync your iPhone. The new ringtone will appear in your settings folder, at the very top.