How to Create shipment in magento
Go to admin-> topmenu-> sales-> order-> order list
Then you can see the list of orders, click on a order to view it.
In the order details page you can "Ship" buttons on the top right of the page.
Now click on the ship button and you see the following screen, click on the "Submit Shipment" button at the bottom right of the page.
After clicking on the "Submit Shipment" button you can see a page like the following PIC.