Hi and Welcome!
this can be accomplished with the free Audacity.
With this, you can record directly from the microphone to your harddisc.
To have the chapters required, split the track at the place which is most convenient.
Export all chapters as WAV and burn an audio CD using your favourite CD writing software.
I admit, this was extremely short. Please have a look at the documentation and tutorials here: http://audacity.sourceforge.net/help/
P.S.: Assuming you have a computer with a soundcard and a CD burner, you only need to buy the microphone (and blank CD-R of course).