Can I say,

Last Sunday was Sally's birthday. Her father threw her a party to celebrate Sally's birthday. Her father gave her a present and it was a beautiful, expensive watch. She was very happy and put on it going to school every day.

One day was sunny and fine. Sally showed her new watch to her friends and played with them happily. While she was playing joyfully, her watch was dropped. When Sally's knew that, she felt very sad as her watch was missing.

One of her friends, Kean, helped her to search for her watch. After that, teh watch had been found in the drain. She thanked KAren for her kindness. She was very happy and continued their game.
Please give me your comments.
Until more qualified people answer, may I give my input? (1)She was veryhappy with it and put IT ON every day when she attended class. (2)One day she showed her friends the watch and then started playing with them. (3) During the game, Sally discovered that her watch was missing. Of course, she felt very sad. (4) Sally and her friend Kean searched everywhere and finally found it in a drain. (5) After thanking Kean for her kindness, Sally went back to the game.
Thanks for your corrections! That means, others are correct?
In your first paragraph, the first three sentences are grammatically correct; in your last paragraph, the sentences are grammatically correc t except for the second sentence: the watch WAS found; better: they FOUND the watch. The middle paragraph is the one that needed most of the corrections. Thankl you.
I would also use noticed instead of discovered because you discover something you didn't know where there
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