11111 1 1
 1011 1101
 1110 0101
 ---------
 1010 0010

Subtraction in Two's Complement

Since the carry into the high order column is the same as the carry out of the high order column, the result is correct. We didn't even need to figure out what decimal numbers the patterns represented. Looking at the situation in detail it turns out that everything is correct:

11111 1 1
 1011 1101  (-6710)
 1110 0101  (-2710)
 ---------
 1010 0010  (-9410)

The "binary addition algorithm" is used for subtraction and addition. To subtract two numbers represented in two's complement, negate the number to be subtracted and then add. Overflow is detected as usual.