Here we go.
http://pcpartpicker.com/user/Blaze17145/saved/V4gzK8$3.84 over. My dearest apologies.
The CPU isn't great, but it's what we could get for the price. It'll handle MOST games just fine, but CPU intensive games such as Battlefield 4 and Planetside 2 might struggle slightly.
The case and motherboard are micro-atx, which is a small form factor. Good size.
The PSU is plenty and is semi-modular, perfect.
The 4GB of ram is what we can get at this budget. As long as you don't run multiple games at once or use too many internet tabs, you'll be fine.
The GPU is an EVGA Nvidia GTX 750. It's about on par with the Xbox One if not slightly better. It should handle 60fps on low/medium in most games.
The keyboard and mouse are both decent. You didn't say you had old ones you could re-use, so I picked these out.
The OS is a copy of Windows 8 (you can use 7 instead but 8 is faster) from
/r/softwareswap, which is usually $10.
This can save you about $80. People at /r/softwareswap are a part of the Microsoft Developers Network and get free windows 8 keys. They sell them for about $10. In order to use it you simply have to install windows 8 on a USB flash drive and input the key you've bought when it asks for it. The people there are very nice and trustworthy and transactions are very fast through paypal.
