Hello! (this is my first guide)
I wanted to help save several hours of trial and error here.

* Harvest wood from a tree. Use a starter stick or any axe.

* Once you have the wood, equip them and stack them on the ground like placing any other block.

* Re-chop the placed wood blocks with an axe and the raw wood will split into processed wood.

I hope this helps, it's needed for chairs, picture frames, and more but had to figure it out the hard way.