There are a number of settings that need to be in place before entering any project information.
1. "Tools" select "Options" then "Calendar" tab - this is where you set what is considered a day. By default Project considers a day to be 8:00am-5:00pm (8-12 working time, 12-1:00pm non working time, 1:00-5:00pm working time) for a total of 8hrs working time per day. This is also where you let Project know how many hours in a week and how many days in a month.
These settings are extremely important as Project looks to these settings to determine how many hours of work in a 1 day duration task. As you can see calculations for work and cost will be determined by these settings.
2. "Tools" select "Change Working Time" - Now that you have set how many hours in a day, you have to make sure the Project calendar shows your calendar settings. I have seen errors when the calendar settings are for a 7.5 hour day and the Project calendar shows a 8hr day.
When you are changing the working calendar. Click on "New" (bottom of dialog box) make a copy of "Standard" calendar. Name the calendar whatever project you are working on. Be aware that there are no Stat holidays in the Project calendar. It is your responsibility as the Project Manager to enter working and non-working days for the project. Keep in mind you are setting the working/non-working days for the project. Resource calendars are set in the "Resource Sheet" view.
3. Now that you have created a new Project calendar. - "Project" select "Project Information" make sure the new calendar you have created has been assigned to the current open project file. By default the calendar is the "Standard" calendar.
4. This step is optional, however it makes the calendar view properly. - "Format" select "Timescale" click on "Nonworking Time" tab and change the nonworking calendar to the proper Project calendar.
These for things need to be done prior to entering in any project information.
If you have created a custom calendar keep in mind that any customization done is only available in the current open project file. If you want the custom object/item available for other project files you will have to use the "Organizer" to move the customization to either the global.mpt file or whatever project file that needs it. ("Tools" select "Organizer")