I learnt how to do this from a book and adapted it to what I needed it for. You could also make a bald cap and cover it white, but I couldn't be bothered. To cover the head, just use a hood from a cape or something.
First, scrape all of your hair back. Using the white face paint, make your face (and neck) completely white.
Following the natural line of your cheekbones and the hollows of you cheeks, paint a curved faint grey/black line along your cheek to represent the hollows of your cheeks. Fade it out as you get to the chin.
Then use the black face paint to blend the line in - you still want the cheekbones to look harsh, so drag the black down gradually.
Paint out the nose in an upside down V shape using the black with a thin brush.
Now cover your eyes with black - again, follow your natural eye socket. You could go up to about the brow, but if you can feel the middle of your bone, you know you've gone too far. Use the sponge to do the main bit, but use a thin brush the do the trickier bits, e.g. the edge of the line, the eyelid.
Now you the trickier bit: the mouth and teeth. Along your mouth, on the inside, paint a black line. Carry that line on until where the fake cheekbone line has been painted. Use a brush to do this.
Using a thin brush, begin to paint on the top teeth using the black. To stop it from looking too harsh, blend it in a little. (Ensure that the teeth are all different shapes and sizes - who has perfect teeth anyway?)
Do your bottom teeth in the same way. Don't worry about them looking wonky or perfect.
Using the yellow, just dab along the face. This will give it an old effect.
For this bit, you can either use the black face paint or a dark grey eyeshadow: paint cracks in the skull. I usually do one from the eye socket up toward the forehead, and a couple around the teeth
And there you have it - your finished product! It may take time and practice to get it right, but it's worth it. Try walking in to Thresher's with skull makeup, a long black cape and brandishing a mop at 10pm - that's what my friend did c;