AC provides a rudimentary crafting system, that allows two or more items to be combined to create a new item. Much like other games with crafting mechanics, this is done by placing inventory items on a grid - optionally in a specific layout - and having the resulting item appear beside them.
In order for an item to be craftable, a Recipe needs to be defined. In the Inventory Manager, Recipes can be defined under the Crafting tab:
Click Create new recipe, and the new Recipe's properties will be listed below. The Name label is only for Editor usage - it won't be seen in-game. Set the Resulting item to the inventory item you wish to create.
For each item that is used to craft this item, define it in the list of ingredients underneath. If an item has Can carry multiple? checked, you can specify how many of that item is required:
If the ingredients need to be placed in specific slots on the crafting grid, check Uses specific pattern?, and then give each item a Crafting slot value. This value corresponds to the index number of the crafting grid.
To display a crafting grid in a menu, two Crafting elements are necessary: one for the ingredients, and another for the resulting item. AC's default interface includes the Crafting menu, which features these elements. This menu's Appear type is set to Manual, so to begin crafting, use the Menu: Change state Action to turn it on: