Yes, that will do. Either way will work. To make it simple, put in the floppy before you turn on the computer.

1. Put Disk Tools floppy in computer

2. Turn on computer

3. Let it boot to the desktop

4. Open the floppy icon, then launch the Apple HD SC Setup application

5. It should automatically find the hard disk drive, then click "Initialize" (this may take several minutes.)

6. Shut down the computer via the Special menu (the Disk Tools floppy should automatically eject.)

7. Remove the Disk Tools, and put the Install floppy disk into the computer

8. Turn on the computer

9. Follow on screen directions to install the software.

10. Restart when prompted.

You should be good to go after that.