I was on active duty when this issue came up. The $640 wasn't for an aircraft toilet seat. It was for the toilet enclosure. Something never brought up was that the manufacturer used the same enclosure in commercial planes and charged the commercial airlines much more. The govt does get ripped off for things it buys, but in my limited experience, it is for things buried deep in the contract, e.g. a subcomponent that only an engineer can figure out.
For instance, I commanded a Dragon platoon. The Dragon missile system had a very good simulator. The simulators were rugged but taken to the field often and lived under harsh conditions. The circuit board on the simulator failed regularly due to our abuse. I had gone to the manufacturer's trainer/armorer course, so I knew how to take the simulator apart and diagnose. We only had three simulators. So if one went down, training was degraded. Wait time for parts was long, so I figured out what part was needed (vice the normal process of replacing a circuit board). I quick trip to radio shack, $5-10 for the part, 15 minutes replacing the part and we were back in business. For some strange reason, the simulators never went down again and I made sure that at least two people in my platoon went to the trainer/armorer's course every year. I don't remember the cost of the circuit board, but it was close to a thousand dollars.
Oh yes, circuit boards in the early 1980s were much simpler than now.
I’m a retired electrical engineer electronics guy. Back in the day, I’ve repaired many a circuit board. Today’s surface mount stuff is nearly impossible to repair.
I grew up in Norfolk with the big Navy base. Plenty of times I encountered Navy guys buying parts in Radio Shack using their own money. Again, back in the day.