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\begin{array}{l}\phantom{40)}\phantom{1}\\40\overline{)96}\\\end{array}
Use the 1^{st} digit 9 from dividend 96
\begin{array}{l}\phantom{40)}0\phantom{2}\\40\overline{)96}\\\end{array}
Since 9 is less than 40, use the next digit 6 from dividend 96 and add 0 to the quotient
\begin{array}{l}\phantom{40)}0\phantom{3}\\40\overline{)96}\\\end{array}
Use the 2^{nd} digit 6 from dividend 96
\begin{array}{l}\phantom{40)}02\phantom{4}\\40\overline{)96}\\\phantom{40)}\underline{\phantom{}80\phantom{}}\\\phantom{40)}16\\\end{array}
Find closest multiple of 40 to 96. We see that 2 \times 40 = 80 is the nearest. Now subtract 80 from 96 to get reminder 16. Add 2 to quotient.
\text{Quotient: }2 \text{Reminder: }16
Since 16 is less than 40, stop the division. The reminder is 16. The topmost line 02 is the quotient. Remove all zeros at the start of the quotient to get the actual quotient 2.