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When you first create an addon domain in cPanel, it asks you for once you have filled out the first box on the page called "New Domain name" the page will automatically generate a username for the new addon domain. This username is what you will see in the second box called :

"Subdomain" as well as the "FTP Username" field which may be hidden by default. If this field is hidden, you can reveal it by checking the box next to "Create an FTP account associated with this Addon Domain." 

The third box from the top of the page is called "Document Root" and this is the directory where you will upload the files for this new site. 

The Document Root essentially acts the same way public_html does for the main account, but When you type something in here, it will make a new folder that acts as public_html for the newly created addon domain.
It also creates a new ftp account for the site. The main difference is that your username is now in the format of addonuser@maindomain.com and then the password you typed in for the addon domain.
For example, if you made an addon domain called: mynewdomain.com and in the second box you made a new Username/directory/subdomain Name called: mynew. with the password: somepass, then you would have a separate FTP account that only allows access to the "mynew" folder. This is nice As a reminder, this is where your new (addon) site's index page and other site files belong. 

You can also create a new ftp account for the addon site. This is generally used if you want to restrict access to your primary site .
You would then login to the FTP site as:

by only allowing access to this folder and those below it.  To do this, check the box next to "Create an FTP account associated with this Addon Domain" and follow the onscreen information. 

You can also simply FTP to the main site, using the main site's username and password, then upload the files as you would to any regular subdirectory. This can be confusing for new users, so our recommendation for simplicity, performance and security reasons is to use a separate hosting account for each site that you plan on hosting. On the other hand, this can be convenient for some other users who may find it better to have one login. For security reasons, we recommend using a new FTP user (with strong password) for each person in your organization who requires FTP access, and those users should only have access to the addon domains which they maintain, instead of the main cPanel's FTP account. 

In regards to , but the "mynew" subdirectory acts as public_html for the new site. I find that way easier but I find a separate hosting account the easiest.
For cPanel, you cannot access a separate cPanel for the new siteeach addon domain. If you wish to have a unique cPanel for each domain, that is only possible with a reseller account.
The when you have a separate hosting account for each domain. If you have many domains that should each have their own individual cPanel, then you should consider a Reseller account, Virtual Dedicated Server or Managed Dedicated Server instead. You can find all of these products on our main site at https://glowhost.com. 

After you have created the addon domain, the way to access the new addon site's cPanel is via to login to the main site's cPanel , then if you have a look around, you see options now (the account where you created the addon domain).  You will now see options for both domains. For example, under mail > add/remove/manage accountsEmail Accounts, you will see drop down menus so that you can make email addresses for either the main domain, or newly created addon domain.

Hope that helps. Feel free to post any comments.

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