300/440/550 1988 JS300 starting issue

Hey guys, so I picked up my first ever stand up jet ski yesterday for $400. We have owned 2 kawasaki sit downs but we knew nothing on stand up jet skis. When we picked it up it wouldn't run but had 150psi and tons of spark. So we brought it home and put fresh gas in it and cleaned the carb, then started cranking it over. It backfired a ton, eventually catching on fire for a few seconds:headbang:but we got that out and it even started up after that. Once we got it started and shut it off, it started up 3 times in a row after that, so we thought we were good and called it a night. Also it runs perfectly fun after we get it going, the first time it hadn't been started in nearly 8 years so it ran rough because there was old gas in the exhaust but after we cleaned that all out it ran perfectly.

This morning, we went out and bought fresh gas lines and some other things. When we came back we tried to start it and nothing happened. About 4 hours later we decided to pull the cylinder off and see if a skirt was broken which it wasn't. Then we took the spark plug wire off and checked it's volts, which was at 0.5. So we cut out the bad part and it gave us 1.7v's which is enough to start it on our sitdowns, is that enough for a stand up? The only other thing we can think of is the guy before us rebuilt it with the wrong piston and it's too tall so the ports are only half open and we're not getting enough gas because the spark plug is nearly dry. We have been pouring gas into the carb and the gas was just collecting at the bottom of the crank case and in the cylinder as well. We can't figure out why it won't fire correctly? Also the gap in the plug is 35, is that right? We figured it was close enough.

What we've checked so far:
-Carb's clean, but the fuel pump needs new seals as it's leaking everywhere meaning maybe the engine isn't getting enough gas and too much air.

-Brand new battery, we also tried boosting it from our car

-Piston and rings are good, cylinder is good. Compression is 146psi, although gas is collecting at the bottom of the crankcase and in the cylinder. Not burnt.

-Electrical problems seem to be ruled out for now anyways because we don't know the specs. 1.5-1.7v's always.

-Brand new spark plug, possibly the wrong clearance or the wrong plug as we didn't buy it.

-Gas lines are clear and unplugged.

-Gas is mixed at 40:1, but we didn't use great oil or great gas. Just outboard oil and 87 gas. Shouldn't be a problem because we run that same oil in our 650 and 750 kawasaki sitdowns.

-Reeds are fine and we made up a new gasket for them out of gasket paper.

-Cleaned out the starter, brushes were a bit worn but it should still start on a regular basis.

EDIT**
-We checked the fly wheel, and it looks good. We have decided it may be out of time and that was why it was backfiring but we are not 100% sure on that.

So far as I said before we only have 2 possibilites. The gaskets around the fuel pump and carborator are sucking to much air and we need to get those which we will even if it's not the problem. And the previous owner stuck any piston he had laying around in there and the ports aren't fully open. But even then shouldn't the gas fire? If anybody has ANY idea what the heck is wrong please let us know, we're spent the better part of 2 days looking at it.
 
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We've now started checking the crank seals to see if we're not getting enough pressure to start. We'll be doing a leak test tonight and probably if it goes bad take the case and split it to see whats up, then order parts tonight and hopefully be working on it again tuesday.
 
Location
MI
Spark plug should be a NGK BR7ES gapped bewteen .028 -.031. If its back firing, its out of time seeing that you have good compression, spark, & fuel. Check the marks on the stator & engine case. Are they lined up? If not, where are they. The mark is at the 12 o'clock position on the case and stator plate. You need to repair the carb fuel leak as well. Compression is well within spec as well. As far as the electical goes, how did you test the plug wire? One lead in the wire & the other to ground?
 
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