Let's create the directory tree on the LFS partition according to the FHS standard which can be found at http://www.pathname.com/fhs/. Issuing the following commands will create the necessary directories:
root:~# cd $LFS
root:lfs# mkdir bin boot dev etc home lib mnt proc root sbin tmp usr var
root:lfs# cd $LFS/usr
root:usr# mkdir bin include lib local sbin share src
root:usr# ln -s share/man man
root:usr# ln -s share/doc doc
root:usr# ln -s share/info info
root:usr# ln -s ../etc etc
root:usr# ln -s ../var var
root:usr# cd $LFS/usr/share
root:share# mkdir dict doc info locale man nls misc terminfo zoneinfo
root:share# cd $LFS/usr/share/man
root:man# mkdir man1 man2 man3 man4 man5 man6 man7 man8
root:man# cd $LFS/var
root:var# mkdir lock log run spool tmp
Normally directories are created with permission mode 755, which isn't desired for all directories. I haven't checked the FHS if they suggest default modes for certain directories, so I'll just change the modes for two directories. The first change is a mode 0750 for the $LFS/root directory. This is to make sure that not just everybody can enter the /root directory (the same you would do with /home/username directories). The second change is a mode 1777 for the $LFS/tmp directory. This way every user can write stuff to the /tmp directory if they need to. The sticky (1) bit makes sure users can't delete other user's file which they normally can do because the directory is set in such a way that every body (owner, group, world) can write to that directory.
root:~# cd $LFS
root:lfs# chmod 0750 root
root:lfs# chmod 1777 tmp
Now that the directories are created, copy the source files you have downloaded in chapter 3 to some subdirectory under $LFS/usr/src (you will need to create this subdirectory yourself).