Among the best guides to analyzing narrative structures is Wayne Booth's Rhetoric of Fiction (listed below)
When you are asked to analyze how the narrator contributes to the sense of horror in the story, you need to examine what makes this narrator unusual.
First, consider the use of the first person viewpoint. Does viewing the story through the narrator's eyes contribute to psychological suspense?
Next, would you expect a first person narrator to be trustworthy? Is Poe's narrator trustworthy? As you read through the story, you can note several places in which the narrator describes what makes him different from ordinary people (look for references to sensitivity, nerves, etc.)
Finally, is the narrator sane?