Neutral kaon photoproduction on the deuteron has been investigated by including the final state effects and compared with the experimental data. Comparison shows that the models used in this calculation can reproduce the data in the $Sigma$ channel r
egions fairly well but still give over predictions in the $Lambda$ channel. It seems that the tensor target asymmetries are more suitable for studying the final state effects. The extractions of the elementary photoproduction amplitude are also demonstrated.
