Solution:
There are three steps in configuring a simple non-routed PPP dial in service:
1. configure a modem
2. configure the line
3. configure PPP
First add the modem and the initialization string.
example: AT&C1&D2S0=1&W
Configure the Line for PPP service and configure it for Dial In.
Ensure that your serial configuration matches your modem.
example: 115200, 8, N, 1, Hardware flow.
Configure the PPP setting for Proxy ARP support:
The Local IP Address = 0.0.0.0
The Remote IP address to be assigned to the dial in client must be an address from the LAN
The authentication method should be set to PAP or CHAP. Create new users in the Local User list (do not use the Ruser).
Dial in with your prefered PPP client.