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If word is the source then the best thing to do is save it as an html file from word using the 'filtered html' option in the save as dialog. If there is an encoding option choose UTF-8. This will create an html file along with a folder with all the embedded content (images, etc). Drag only the main html file to Calibre's main window, it will grab the rest of the content and create a zipped ebook format.
From there you can edit metadata, cover, etc and convert to your destination format. A lot of people choose to convert to epub first, then to final 'ebook' editing/formatting in Sigil, then finally convert to whatever destination format is desired.
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