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Here's a procedure for setting up the distributor timing:
First you need to find Top Dead Center (TDC) for the compression stroke in order to time the ignition distributor. To find TDC, remove #1 spark plug and disconnect the ignition coil wire. Have someone tap the ignition switch start position to slowly crank the motor while you put your hand over the spark plug hole. When you feel the compression, stop. Now look down at the timing pointer at the front pulley. It should be pointing to ZERO. If not, manually turn the motor clockwise or counter-clockwise by hand until it's pointing to ZERO. Now determine the #1 plug wire location on the distributor cap. Mark that location on the distributor body. Now insert the distributor into the block, meshing the gears so that the rotor ends up pointing to the mark you put on the side of the distributor body. You now are timed close to correct; you should be able to start the motor.
Before starting the motor, set up a timing light so that you can set the timing to spec. Disconnect the TPS harness connector. It's located on the passenger's side of the engine just above the throttle assembly. Start engine and set timing to 20 degrees BTDC. Check the idle speed. It should read 650 RPM; If not, adjust the idle screw until you get 650 RPM. The idle screw is located on the passenger's side of the engine near the firewall below the intake manifold. Stop the engine. Reconnect the TPS harness connector. Start engine. The idle speed should now be 700 RPM.
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