Disconnect the wire to the distr so there's no sparking during the test. Remove all 8 spark plugs but for observation purposes, keep them organized to reinstall in their same locations. I would also loosen the flex fuel line at the fuel pump just to make sure no extra gas gets pumped to the carb in case your inlet valve is defective. Prop your carb open so that air is easily drawn into the cylinders.
Make a record of the test. Record the readings for each cylinder and date it for future comparison purposes. If your compression tester threads into the spark plug hole, snug it up. Many testers have a rubber plug that requires you to hold it firmly against the hole.
You can make this a one-man test but i recommend that a helper operate the starter for each test. A few seconds of cranking are all that is needed to get a reading on the gauge. If you are holding the gauge to the plug hole manually, you will feel the pulses of pressure...keep the gauge tight til that cylinder is done. The gauge will hold the reading til you release the pressure (usually a small button on the gauge does that). Record the number and go on to the next cyl.
Flathead pressure readings on NEW or recently rebuilt motors should be in the neighborhood of 100 to 120 psi. A good running motor that's got some mileage on it could be down to 90 psi and it's ok. Readings significantly below that on all cylinders indicates worn cylinders, worn rings, worn pistons. Low readings in one or more cylinders could be bad valves in that cyl. Low readings in two adjacent cyl is usually a leaking head gasket.
You can also do what's called a wet test....after doing the above dry test. This is where you see real low readings on certain cylndrs. Squirt a couple shots of motor oil into that cylinder's plug hole. Redo the compression test on it. If the reading goes up somewhat, the problem is the fit of the rings in the cylndrs. If the reading remains the same, a valve is not seating.
Don't forget to replace the ignition wire, replace all spark plugs in their correct locations, reconnect the fuel line fitting, and free up the carb linkage.
Reading the appearance of your plugs is also important. You can find a plug condition chart in most engine service books or online.
Be sure your battery is fully charged for a compr test. The reason for pulling all the spark plugs is to take away all compression in the motor...makes it much easier on the battery.