Parts markup. Probably charged $250 for the alt and $175-$200 for the battery.

Hour and a half labor, shop costs, and tax make up the rest.

A poor electrical connection will do that. Considering the amount of current that an alternator is often called upon to produce, every connection has to be in great condition. For example, even a resistance of only 0.05Ω, which is too low to measure reliably with a convention ohmmeter, would dissipate 180 watts of power if the alternator is putting out 60 amperes, which it might be called on to do after starting the engine, with the lights on, etc. (Power = I^2 × R). That would be like having three 60-watt soldering irons applied to that single point,

 

If the current output drops to 30 A, the dissipation would drop to 45 watts—still a sizeable amount of heat to develop in a single small point, and it would probably get quite hot to the touch.

 

That's what causes connectors to melt and burn.