The Bone panel is sensitive to setup or animation mode: only the twist control appears in animation mode.

In setup mode, use the New button to create a new bone. If there is a current joint, the new bone is automatically connected to that joint. When a bone is created, joitns are also created as needed. The new bone will appear in the skeleton list as mosBone,#. Each bone is prefixed with "mos" (MOtionStudio) so that all bones are kept together in scene lists (or whenever sorted alphabetically). Remember that you can rename Motion Studio objects however you like.

The New TBone button creates a special kind of bone that has three joints. Read more about t-bones here.

Click Flip to change the way the bone points. Flip changes which joint is considered the root and which the tip.

Twist rotates the bone around it's axis. Drag the green arrows to twist the bone. In setup mode, the bone will twist independently of any attachments.

In animate mode, the bone's attachments twist right along with it.