hi, welcome to Miniriders,
make sure you drop by and say g'day in the Introductions thread too, and post up a pic of the bike while you are at it.
Introduce Yourself thread
with it smoking at the exhaust manifold gasket, i would say it may be running a bit rich ?
does it still have the oil tank mounted behind the front numberplate ?
or are you running Premixed fuel through it ?
the original exhaust manifold gasket is fitted with a restrictor ring inside it.
this is to help young ones to learn to ride, before removing it once they gain confidence, and giving the bike a bit more power.
if you drop the pipe off the head, the gasket should be sitting there, or stuck to the head.
pop if out and check that the restrictor ring has been removed.
if you look into the pipe and there is a fair bit of carbon/oil there i would recommend that you burn it all out.
it will restrict the bikes' performance and can also cause it not to run too well.
if the exhaust gasket is us, they are easy to find, this will do the trick, and you'll have a spare too-
http://www.ebay.com.au/itm/Pit-bike..._Parts_Accessories&hash=item4ac65cbe2d&_uhb=1
i have a PW50 i fixed up for my son too,
the link to the build thread is below in my signature.
cheers craig