Setting pinion preload

[CultClassik]

From what I've read at various online places and in the FSM, it seems to me this is where the preload shims are located. For whatever reason I haven't seen a definitive "place them here".

I wanted to make sure this is correct before I mess with the thing. It doesn't seem like a super awesome fit, but there's a slight shoulder there and it's the only thing that makes sense to me so maybe I'm right?

 

[Bad Sport]

For the step pinion that is correct.

 

[CultClassik]

Thanks Bad Sport! Mine is a 741, small stem. After starting at that same diagram (for a small stem), I noticed there is a spacer that goes between the pinion bearings, which makes a lot more sense. Now...if I can find one since obviously I do not already :/