Skinning

What You Need:
Dagger

Corpse

How?
Press Z(Interact) and "Interact" with the dagger, then with the corpse. A message about you skinning the unlucky thing will appear. Just wait. When your done, a message will appear confirming that you have finished and a hide will be on the ground.

Why?
The main reason you would skin NPCs would be for either: A) Leather Armor B) Sick Amusement

I'm assuming your going with A. If your going with B, do -not- come near me. Crafting leather armor requires four hides. Each hide has its own Potential. Potential is how likely the armor will be good. The higher the potential, the better. If you can find a group of dead gremlins, their hides are all a potential around 10, which is good enough for starters.

''' Butchering

What You Need : Any sharp object Sword, axe, etc.

How? : Press Z to interact with the butchering item of your choice once equiped, then click a corpse, it will ask you if you want to do different body parts, choose body, it will then cut out valuable meaty foods that you can eat, nothing should go to waste as it all can be eaten except for bones. Just cook near a campfire!'''