1. Write Your Book
I write my book in Word (docx). You need to think about how you are saving it. Amazon prefers docx or html filtered webpage. Smashwords wants either an epub or doc (not sure the difference, 97-03 Compatibility Mode). So the most important thing is to make sure you know what the distributors require.
2. No Headers And Footers
Page numbers, headers and all that sort of thing don't need to be added. Amazon have their own process for that. So don't even think about it.
3. Font... Size...
I usually set my font to Calibri and size 14. Technically they prefer times new romans but I think Calibri is easier to read.
4. Spacing and Indentation
Spacing is an important one. You don't want everything to close together. It's recommended that you have 1.5 spacing, so one and a half but I tend to just chose multiple. That works well for me. As for indentation, I remove it all together. You really don't need an indentation every time you start a new paragraph but if you want to, DON'T use the tab button, set it up in the formatting section, under spacing and indentation. Then you can choose how far you want it indented and it will happen automatically. It will look better and your distributors will be happier too.
5. New Chapters...
Every chapter is a section so you have to start a new section when you finish your chapter. Every time you finish a section, whether it's just a list of your books, or a note from the author, or chapter five, start press the start a new section on a new page option.
6. Don't Do A Double Space
I don't really know why I'm telling you this, because I've never been a double spacer but it's one thing I picked up from all those blogs. Don't double space after your periods.
7. Don't Add Your Cover
For most distributors, they will add the cover themselves so you don't need to. Amazon will remove your cover if you add it.
8. Adding A Contents Page
I don't bother but if you want to add one, the automatic ones Word will do for you is perfectly fine so you don't need to overthink formatting for it.
9. Adding An Image or Hyperlink
You can add images or hyperlinks by going to the insert section of the taskbar. Simples.
Finally add it to your distribution websites in whatever format they want. I usually use an online converter to make an epub and mobi copy too so that I can give them out as free giveaways, arc copies and instafreebie books.