A central processing unit (CPU) is utilized in combination with external memories and input/output devices to form a Microcomputer System. The CPU is a 16-bit fixed word length processor monolithically integrated onto a single semiconductor chip which uses two's complement arithmetic for computations. The CPU includes an arithmetic logic unit (ALU), accumulators, data path multiplexers, program counter means, and programmable logic arrays to control operation of the processor.The processor of this invention is capable of using a homogeneous memory, wherein instructions and data are both stored in the same memory. In the disclosed embodiment, 15 of the 16-bits are used for addressing the memory. Thus, the processor is capable of directly addressing 32,768 16-bit words in the memory.An external 16-bit bus is used to interconnect the external memory and input/output devices with the CPU. Bidirectional three-state logic is used to enable both input and output data, as well as memory addresses, to be transmitted over the same bus thereby simplifying design. In addition, provision is made for coupling an operator console into a system formed around the processor of this invention, thus allowing for a user to interface with the system.