Bed wood, square nuts, need your help

[hairdog]

Okay, I'm at the installation stage. I ordered the unpolished stainless rails and stainless bolt kit. My question today is about the bolts and washers. I have some 5/16" x 1-1/2" bolts. I have more 1/4" x 1-1/4" bolts. I have fender washers with 5/16" holes. I have regular washers with 5/16" holes. I have both sizes of lock washers.

My main questions:
Do the 5/16 bolts go in the holes around the edge and the 1/4 bolts go through the rails? Where do the fender washers go?

Thanks for any help you can provide.