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\begin{array}{l}\phantom{1000)}\phantom{1}\\1000\overline{)123456}\\\end{array}
Use the 1^{st} digit 1 from dividend 123456
\begin{array}{l}\phantom{1000)}0\phantom{2}\\1000\overline{)123456}\\\end{array}
Since 1 is less than 1000, use the next digit 2 from dividend 123456 and add 0 to the quotient
\begin{array}{l}\phantom{1000)}0\phantom{3}\\1000\overline{)123456}\\\end{array}
Use the 2^{nd} digit 2 from dividend 123456
\begin{array}{l}\phantom{1000)}00\phantom{4}\\1000\overline{)123456}\\\end{array}
Since 12 is less than 1000, use the next digit 3 from dividend 123456 and add 0 to the quotient
\begin{array}{l}\phantom{1000)}00\phantom{5}\\1000\overline{)123456}\\\end{array}
Use the 3^{rd} digit 3 from dividend 123456
\begin{array}{l}\phantom{1000)}000\phantom{6}\\1000\overline{)123456}\\\end{array}
Since 123 is less than 1000, use the next digit 4 from dividend 123456 and add 0 to the quotient
\begin{array}{l}\phantom{1000)}000\phantom{7}\\1000\overline{)123456}\\\end{array}
Use the 4^{th} digit 4 from dividend 123456
\begin{array}{l}\phantom{1000)}0001\phantom{8}\\1000\overline{)123456}\\\phantom{1000)}\underline{\phantom{}1000\phantom{99}}\\\phantom{1000)9}234\\\end{array}
Find closest multiple of 1000 to 1234. We see that 1 \times 1000 = 1000 is the nearest. Now subtract 1000 from 1234 to get reminder 234. Add 1 to quotient.
\begin{array}{l}\phantom{1000)}0001\phantom{9}\\1000\overline{)123456}\\\phantom{1000)}\underline{\phantom{}1000\phantom{99}}\\\phantom{1000)9}2345\\\end{array}
Use the 5^{th} digit 5 from dividend 123456
\begin{array}{l}\phantom{1000)}00012\phantom{10}\\1000\overline{)123456}\\\phantom{1000)}\underline{\phantom{}1000\phantom{99}}\\\phantom{1000)9}2345\\\phantom{1000)}\underline{\phantom{9}2000\phantom{9}}\\\phantom{1000)99}345\\\end{array}
Find closest multiple of 1000 to 2345. We see that 2 \times 1000 = 2000 is the nearest. Now subtract 2000 from 2345 to get reminder 345. Add 2 to quotient.
\begin{array}{l}\phantom{1000)}00012\phantom{11}\\1000\overline{)123456}\\\phantom{1000)}\underline{\phantom{}1000\phantom{99}}\\\phantom{1000)9}2345\\\phantom{1000)}\underline{\phantom{9}2000\phantom{9}}\\\phantom{1000)99}3456\\\end{array}
Use the 6^{th} digit 6 from dividend 123456
\begin{array}{l}\phantom{1000)}000123\phantom{12}\\1000\overline{)123456}\\\phantom{1000)}\underline{\phantom{}1000\phantom{99}}\\\phantom{1000)9}2345\\\phantom{1000)}\underline{\phantom{9}2000\phantom{9}}\\\phantom{1000)99}3456\\\phantom{1000)}\underline{\phantom{99}3000\phantom{}}\\\phantom{1000)999}456\\\end{array}
Find closest multiple of 1000 to 3456. We see that 3 \times 1000 = 3000 is the nearest. Now subtract 3000 from 3456 to get reminder 456. Add 3 to quotient.
\text{Quotient: }123 \text{Reminder: }456
Since 456 is less than 1000, stop the division. The reminder is 456. The topmost line 000123 is the quotient. Remove all zeros at the start of the quotient to get the actual quotient 123.