Find the song in your iTunes library on your PC
Play it and note the start and end times of the part you want to use (no more than 30 seconds)
Right click on the song and choose Get Info (it's the top item in the list)
Choose the Options tab and enter the Start Time and End Time that you noted in Step 2.
Tick the boxes next to the Start Time and End Time and click on OK
Play the song again and make sure that the right bit has been selected. If necessary repeat steps 2 and 3.
Right click on the song again and select Create AAC Version (it's the fourth from the top).
A new track will be created which will have the same details as the original track (except that it will be shorter).
Right click on the newly created track and select Show In Windows Explorer
Right click on the file and rename it so that its extension is .m4r instead of .m4a (if you can't see the extension, from the Explorer menu choose Organise/Folder and Search Options/View and untick Hide extensions for knoiwn file types).
Double click on the newly renamed file. It will be installed in iTunes as a ringtone.
With your iPhone attached, in iTunes select your iPhone in the lefthand sidebar and then in the main panel select the Ringtones tab and make sure that "Sync ringtones" is ticked
Sync your iPhone in the normal way