All gone begins with your dominant hand open and palm facing inward. Your non-dominant hand lies open and flat to form a base with your palm facing the sky. You perform the sign by moving your dominant hand forward, away from you, while clenching your first.
The motion is similar to clearing a table, as if you were taking everything off the surface so that the contents are all gone.
All gone is used when there is none of something left. So if you are eating a bowl of popcorn with your baby, and she eats the last one, you could sign 'all gone'. All gone is very similar in meaning to all done. We use all done when we have finished an event, such as playing on the swing. All gone is when a quantity of something is exhausted. In many situations, both are equally correct and interchangeable. For example, when you have finished eating a bowl of popcorn, the popcorn kernels are all gone, and you are all done with the activity of eating.
All gone is best introduced based on real-life props. Start teaching all gone by placing a few items in front of your baby. Then remove them and sign all gone. From there, start generalizing the meaning of the word with different examples.