My old motor had 2 bolts holding the front sprocket.
The new motor (also from a 1987) has a clip and washer.
Where does the washer go? Under the clip (facing out) or between the sprocket and the engine (facing in)?

Also, the new sprocket I bought has a 'step' on one side (the old was plane on both sides). Where should the 'step' be facing to: inside (motor) or outside?

 

And yours is a KLX not a KLR