Advanced techniques for state machine design for both novice and experienced digital designers. The first and prerequisite to a series of booklets, 8 volumes in all, devoted to arithmetic processing utilizing state machines. Proper and optimal framework and process structure are provided. Handling and using data objects within states, such as counters and data variables. Utilization of stacks, which is not taught anywhere else, allowing the implementation of subroutines that can be called from other states. Simple, short, and concise, a must for all digital designers. As a bonus, the addendum contains a fully functional arithmetic fixed-point processor as a single state machine, using many of the techniques provided in this book.