Let's perform the following steps:

1. Log in to your account:

$ az login

2. Create a resource group named k8sdevopscookbook in your preferred region:

$ az group create --name k8sdevopscookbook --location eastus

3. Create a service principal and take note of your appId and password for the next steps:

$ az ad sp create-for-rbac --skip-assignment
{
 "appId": "12345678-1234-1234-1234-123456789012",
 "displayName": "azure-cli-2019-05-11-20-43-47",
 "name": "http://azure-cli-2019-05-11-20-43-47",
 "password": "12345678-1234-1234-1234-123456789012",
 "tenant": "12345678-1234-1234-1234-123456789012"

4. Create a cluster. Replace appId and password with the output from the preceding command:

$ az aks create --resource-group k8sdevopscookbook 
 --name AKSCluster 
 --kubernetes-version 1.15.4 
 --node-vm-size Standard_DS2_v2 
 --node-count 3 
 --service-principal <appId> 
 --client-secret <password> 
 --generate-ssh-keys

Cluster creation will take around 5 minutes. You will see "provisioningState": Succeeded" when it has successfully completed.