When I got my KZ750 LTD I think the previous owner/mechanic ordered a rear sprocket by looking it up, instead of checking what was on the bike. A KZ750 twin uses a 38T rear sprocket, which is what mine had along with the original 13T front sprocket. It was a rocket off the line, but I was in 5th most of the time because the gearing was so low.
I changed to a 530 chain/sprocket set. I went with a 16T front (part number JTF513 -16), and a 38T rear (part number JTR488 -38) using JT sprockets, and a DID chain (DID50VX114).
There is probably enough space to go one sprocket up on the front (to a JTF513 -17), I wouldn't try going any higher, there isn't much room there.