I found a light mage amulet in a random event. Can anyone tell me what it does?

it's wearable and you can also give it to the Mage in Shadowglen and you might get a Tome of Light in return, which is a stat booster. You have a much better chance of just getting a Light Shard though, which you can use in battle

I got the Tome of Light! Should I sell it or use it?

Using it gives your pets stats 1-3 in all their stats. If you're not into battling/training your pet then selling it would be your best choice.