1) A compass is used to determine bearings to navigate from one point to another. The direction of travel arrow points towards the destination and the red end of the needle points to north.
2) To find a bearing on a map, place the compass on the map with the direction of travel arrow pointing towards the destination. Rotate the dial until the orienting lines align with the map gridlines and north is at the top. The bearing is read at the index line.
3) Declination is the difference between true north and magnetic north and must be accounted for when converting between map bearings and compass bearings. The rules are "Map to compass, dump it. Compass to map, add it back