Tim,

You have mentioned the obvious, the proper plug wiring as a potential
problem.

If they are correct, I'd next verify that the distributor is installed
correctly so the timing is in proper sync with the camshaft and in fact the
rotor is pointing at plug 1 when it is supposed to be.

If that is correct then the next place to inspect is the timing chain. I'd
remove all plugs and turn the engine over by hand with a finger (or
compression gauge) in the sparkplug hole for No.1 cylinder. As the
compression comes up, verify that the timing mark on the harmonic balance is
near the correct place with the pointer. If not turn the crankshaft one
more full turn and check again.

You might do this several times to 100% conclude in your mind that infarct
there is (or is not) a problem.

If this is not working out, then you need to decide if you or a mechanic
will do the replacement of the timing chain. Usually on a Mercruiser it is
not a large task since everything is right there in the open. Before
tearing into it, you might want a second opinion form a trusted mechanic.

Dumb as this might sound, I have seen the problem you mention when the + & -
on the battery are connected incorrectly.

Don Dando