yo,
As Seattle asked, is this for the 87 5.0/AOD or the other vehicle you were driving during the 87 rebuild?
Overview & Ford Part numbers, Bronco & Ford;
"...Detect cylinder block vibrations caused by engine knock and send a signal to the computer to retard ignition timing.
FAILURE SYMPTOMS, Engine knock, loss of power, MIL light.
Check connection and signal from sensor when complaints of engine knock are present; 1996-1986 5.0L (N)/ 302 Bronco, E150, 250, F150, 250 E3AF-12A699AA,E3AZ-A Tomco PN 29021,
$66.64 as of 10 JUN 2010..."
Source: by tomco-inc.com
Wiring Diagram in 87-89 5.0 Bronco & F series (Mitchell)

Source: by equivalent (Beetlejuice) at SuperMotors.net
See B-9
Location pic in an 89 5.0; "...After you have unplugged all the injectors, temp sensors, AC, oil sender, distributor and whatever else you can see, including this knock sensor at the rear pas side of the motor,..."
Source: by Waltman at FSB

Waltman wrote; "After you have unplugged all the injectors, temp sensors, AC, oil sender, distributor and whatever else you can see, including this knock sensor at the rear pas side of the motor..."
Location pic in 84-86 5.0 (& ECT & Temperature Gauge Sending Unit)
Source: by Ryan M (Fireguy50) at
http://www.fordfuelinjection.com/public/302truck_1986_lower-intake.gif
Location in Engine Bay Diagram in an 87-88 4.9L; #1
Source: by Ford via Chilton
Ford Part Number in Vehicle Emission Control Information (VECI) Decal; Contains Vacuum Diagram & Calibration Parts List for 88 & UP. On-Line for Free at Ford. Click "Quick Guides" in left panel; Scroll to & CLICK VECI Labels "Provides Vehicle Emission Control Information (VECI) and a related calibration parts list." Enter applicable info (
need to know your Calibration number from your B-pillar sticker). Vacuum Diagram is the same as the one on the core support or hood or air filter cover. Suggest Right Clicking this Hot Link & Open in New Window
Source: by Ford @
http://www.motorcraftservice.com
Overview & Depiction; "...1996 7.5L, 5.0L and 5.8L do not require a knock sensor;
During engine operation the knock sensor (KS) (12A699) will generate a signal to the powertrain control module (PCM) (12A650) to retard timing if the engine knocks..." from 1996 F-150, F-250, F-350, F-Super Duty Series and Bronco Vehicles Workshop Manual
Source: by Ford
Late night reading version;
Overview; "...A knock sensor monitors vibration in the engine and reports this information to the PCM. The PCM is calibrated to react to a range of vibration that is associated with the frequency and intensity of the ringing in the engine assembly associated with audible detonation. The physical location of a knock sensor on the engine should be chosen to allow, as nearly as possible, equal sensitivity to knock in all cylinders. The PCM calibration is carefully adjusted to insure detection of detonation while ignoring other background engine noise. Inclusion of a knock sensor and its calibration strategy helps to insure that the timing will be optimized despite variations in fuel octane, changes in ambient temperature and humidity, formation of combustion chamber deposits and compression changes caused by high mileage engine wear. In late model Ford engines, the knock sensor is allowed a range of influence, both above and below the corrected base timing value. A typical number for this range is plus or minus 6 degrees for a total range of 12 degrees. The base timing table is calibrated using 87-octane fuel. When the engine begins running above idle, the ignition timing is initialized at a number equal to the current 87-octane base table value plus any spark adders from associated scalars or tables (positive or negative). An example of a spark adder would be a table of values that adds spark at different speed/load cells while the EGR is active. Other adjustments to spark timing are available in the calibration for corrections based on intake air temperature, coolant temperature, barometric pressure, etc. As in the case of the IAT sensor on late model engines, these tables or adders may be 'zeroed out' and not used, at the discretion of the calibrator. (Note: Spark tables are defined in terms of RPM and 'load'. Although load is a composite number based on several parameters, it can be thought of as proportional to throttle opening for purposes of this discussion.) If knock is detected while running above idle at the corrected base value, the timing jumps back immediately by a calibratable amount, typically -3 degrees. If knock continues to be present at this new advance value, the timing will jump back 3 more degrees in the negative direction. The total negative deviation from the "correct" laboratory value is usually limited to 6 degrees. If, on the other hand, the engine at its current base spark value shows no knock, the timing is steadily advanced at a calibratable rate (typically 1 degree/second) until knock is detected. Then the immediate 3-degree jumpback occurs as many times as necessary to eliminate the knock, again limited to -6 degrees from base. The ignition advance remains in this continuous tug-o'-war between this slow 1 degree advancing and immediate 3 degree jumpback. The goal is to provide an engine free of audible knock while maintaining the highest possible spark advance to provide maximized power and fuel economy. Use of a fuel with octane higher than 87 can provide a small but noticeable increase in power and fuel mileage. There are certain RPM vs. load points in the table where the full 12 degrees of ignition adjustment by the knock sensor strategy is not available. At high load and/or high RPMs, gasoline engines typically have maximum spark advance values that are detonation-limited requiring that they run a base value that is below optimum. In these table cells, there is an advantage to allowing the spark to advance when possible. At lower RPM-load points, the base value provides the optimum spark advance and any additional advance would reduce power rather than add it. Therefore, there is a clipping table which overrides the other calculations to define the maximum spark advance allowable at any given RPM vs. load point. So, at lower RPMs and engine loads, the range of influence for the knock sensor may be limited by the clip to as few as 6 degrees, all negative. Side note: The above strategy applies to conditions above idle. When the engine is idling and there is normally no possibility of spark knock, the ignition timing goes into a different mode that does not involve the knock sensor. At idle, the timing advance is used to help control the idle speed. The Idle Air Controller (IAC) provides the slow, coarse adjustment and the ignition timing is the fine adjuster, reacting quickly to correct small RPM errors from the desired idle speed..."
Source: by rwenzing