Hello, I'm just wondering if I've a diagram state with three conditions : A, B, C. then how can I determine the length of the bit? I know for example if there was four states then there for every condition must be consisted from "two bits" in binary , what about three states?

 

Three states still requires two flip-flops. Since 2^2 = 4, there is an extra (fourth state) that is not allowed. The steering logic should make it impossible for the state machine to arrive at that "not-allowed" state from one of the valid states.

Sometimes there is a possibility that the machine will power up in the "not-allowed" state. In that case, there should be an automatic transition to one of the allowed states on the very first clock...