I find adding a new user in Ubuntu really confusing. Surely there should be a wizard program for it? Anyhow, for my records here is how I do it.
Create the user
useradd -d /home/username/ -m username
Set the users password
passwd username
Then I log in as the user
su user
Change the shell to /bin/bash
chsh
You can make the user a sudoer / administrator by using the massively confusing script name called adduser
Ubuntu 10:04
adduser username root
Ubuntu 13.04
adduser username admin
Ubuntu 14.04
adduser username sudo
Ubuntu 16.04
usermod -aG sudo username