You place the #1 plug on TDC compression stroke and ensure that the distributor rotor is pointing directly to #1 lug, then ensure your crank shaft is at about 6 degrees BTDC.

Search "Indexing the Distributor".

 

I went thru this ordeal when rebuilding my 318.
the harmonic balancer has indicators stamped on the face of it, V6, V8, TDC. You want to set the harmonic balancer on "V8" with the "0" mark on the timing indicator, the you need to loosen your distributor, out of the three wires going to the distributor one of them will be the 5V reference wire, while turning the distributor your going to probe that wire with the ignition on, and set the distributor untill the voltage reaches 5V, The injectors are now timed properly, make sure it's right at 5V because i put mine at 5.20V and it ran like poo,.

 

And if it is rite at 5v and at 5.13 volts??

 

This is how the service manual says to do it:
#1 cylinder at TDC on the COMPRESSION STROKE.
Then make sure the rotor is pointing to the mark.

 

i don't know how many so called mechanic shops i have told this and they still try to tell me that you have to set the timing by the distributor which the mechanic at the dealer told me otherwise the distributor is only for they injector timing the timing itself is set by the computer

 

Exactly, turning the distributor doesn't change ignition timing at all..... though if you turn it far enough, you will be trying to fire the wrong cylinder. It DOES change injector timing though.