I have assigned an ip address of 192.168.1.2 for my local server computer. From this server I want to host a simple application using wamp server upto five or more computers. For default gateway I have 192.168.1.1 and subnetmask would be 255.255.255.0. So my question is what would be the proper and correct way of ip addressing the other five or more computers. Any help and advises would be very much appreciated.
I assume your question is about a local network with a router. A standard design depends of your number of network devices attached to it and what you want to achieve. Better said there are best practices to follow than a standard. For a small network like the one you described it is okay to have the IPs set statically for all of them.
As you said you will use a 192.168.1.0/24 network so you have a limit of 254 hosts (192.168.1.1 to 192.168.1.254, as .0 describes the network and .255 being the broadcast address).
So it will be fine to set those 5 computers to any IP from the above range except 1 - your router, 2 - your server and every computer should have a different IP with the same default gateway (needed only for access outside your network) and subnet mask.
A setup like that is okay if your number of hosts is low. When your number of hosts will increase you have to think about DHCP, DNS, then you probably will find that it could be a good think to divide the networks (and probably a /24 network will not suffice any more).
To come back to your question, if those other five computers are clients I would use the router's DHCP capability and set it to give out IPs starting from eg 20, so you would have enough room to add other servers with static IP, but as said above when the environment starts to grow you will have to implement services which will be helping you maintain it without the overhead when doing it manually.