Xubuntu doesn't have a nice gui editor for the desktop menu. It isn't hard to edit by hand, though.
Each application that appears in the desktop menu has a corresponding file in /usr/share/applications. To create a new one, just copy an existing one and edit it. For example, I created one for jEdit by copying the netbeans.desktop file:
Modified to jedit.desktop:
One important entry is the "Categories", this puts the applications in the appropriate place in the menu. Possible choices are:
There are others, but these are the common categories.