Step 1:
Login as administrator in Moodle. In the Administration menu, click on Plugins-> Filters-> Manage filtersChoose Filter for Tex notation and change Active? to On. If you click Settings it will bring you to the same screen as in the next step below.
In the Administration menu, click on Plugins-> Filters-> Tex notation
Verify that Path of Latex, dvips and convert binary all contain the linux tools that was created in Part 1 of this tutorial.
Latex = /usr/bin/latex
dvips = /usr/bin/dvips
convert = /usr/bin/convert
Change the convert output format to PNG.