Categories are used to organize your contacts and events into groups. There are multiple ways to assign categories to events or contacts.
For one specific contact or category, the detail badge (black area on the right side of the detail view) has a popup menu that is accessed by clicking on the double arrows. The menu can be used to add a category, or to replace the primary category with another category.
In addition, right-clicking a category that already appears in the detail badge will allow you to remove the category, or assign that category as the primary category.
(Note that if you only have one category in the list, and it's already the primary category, those two menu items are disabled. Now X requires that at least one category be assigned to each contact or event, so you can't remove the only category, and there's no need to assign the category as the primary if it's already primary.)
If you want to assign categories to multiple events or multiple contacts at the same time, you can do that in the list views. While in the event list view, for example, you can select multiple events. Then, go to the Edit menu and select the "Assign Categories..." command.
A dialog will be displayed showing all the currently available categories for that type (event or contact, since the categories are data-specific).
You can also assign categories to multiple contacts by highlighting those contacts from list view then dragging them over to the appropriate category and dropping them in.
