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\begin{array}{l}\phantom{27)}\phantom{1}\\27\overline{)37}\\\end{array}
Use the 1^{st} digit 3 from dividend 37
\begin{array}{l}\phantom{27)}0\phantom{2}\\27\overline{)37}\\\end{array}
Since 3 is less than 27, use the next digit 7 from dividend 37 and add 0 to the quotient
\begin{array}{l}\phantom{27)}0\phantom{3}\\27\overline{)37}\\\end{array}
Use the 2^{nd} digit 7 from dividend 37
\begin{array}{l}\phantom{27)}01\phantom{4}\\27\overline{)37}\\\phantom{27)}\underline{\phantom{}27\phantom{}}\\\phantom{27)}10\\\end{array}
Find closest multiple of 27 to 37. We see that 1 \times 27 = 27 is the nearest. Now subtract 27 from 37 to get reminder 10. Add 1 to quotient.
\text{Quotient: }1 \text{Reminder: }10
Since 10 is less than 27, stop the division. The reminder is 10. The topmost line 01 is the quotient. Remove all zeros at the start of the quotient to get the actual quotient 1.