In XPS, you can select Project -> project options. Under the design options tab you can tick the create test bench template. If you want to simulate with your software application, you can add the elf file under edit -> add elf file. If you are using isim (the default Xilinx simulator) the simulation libraries will be pre-compiled. If using a third party simulator you will have to compile the libraries under edit -> preferences, choose the simulation of the left. Here you will need to provide the path to the simulator exe, and manually compile the libraries. Once this is done, you can generate the HDL simulation files, under simulation, then launch the simulator.
