Through process of elimination, I found and replaced the bad RAM 4116 chips. There were two bad ones.
If you're troubleshooting an IBM PC, be sure your switch settings are correct AND that you're referencing the correct motherboard. There are two types 16K/64K and 64K/256K.
System has one disk drive, a IBM display adapter (monochrome), IBM serial card, and an IBM disk controller. Also present was a non-IBM 64K card.
1. Initial Status:
a. 16K/64K motherboard switch settings indicated a math co-processor present, yet none existed. SW2 settings indicated 2 disk drives.
b. power on beep code - long beep followed by two short beeps (bad display card)
c. screen error codes - 0840 201 followed by PARITY CHECK 1
d. mother board switches:
SW1 0100 0011 (co-proc, mono, 64K, one DD)
SW2 1011 0000 (at one time there may have been two disk drives?)
2. Although I was getting a display card error (the beep code), the display was at least able to show the screen errors, so for now I left the display adapter in place.
3. I fixed the motherboard switches to match the current configuration. See section G of IBM PC Technical Reference for details)
4. Boot - still not able to make it to BASIC screen. [ 0840 201 then PARITY CHECK 1. ]
5. Bank 0 of RAM is not socketed, 1,2,3 are socketed. With fingers crossed set mother bd switches to 16K (to ignore the rest of the RAM) and removed the 64K memory card from system.
I was able to get to the BASIC C1.00 screen BUT I found that the display of lines 1-13 blinking, the last 12 OK.
Swapped out the display card, replaced with an IBM CGA card and monitor.
Here is the test program I ran in BASIC:
10 FOR K = 1 TO 1000
20 PRINT K
30 NEXT K
6. Reboot - No more beep code errors.
7. Turned on the next 32K RAM. (see Tech Reference for Switch settings)
SW1 settings for 32K on a 16K/64K MBd.
BASIC screen with 32K
DOS 1.0 boot screen
8. Turned on next bank of RAM 48K (see Tech Reference for Switch settings)
No 0840 201 code, but there PARITY CHECK 1 returned.
This means that bank 2 has a bad RAM chip
9. Swapped RAM from bank 3 with RAM from bank 2. Was able to boot to 48K. Also able to determine that the last two 4116's in bank 3 were the bad ones.
10. Found 2 4116 RAM chips from my inventory (why it pays to keep track of your chips).
System restored to a full 64K. Did not bother with the 64K expansion card, it's not IBM stock.
Ordered a replacement IBM Display Adapter card.