An Excel math question

Hi, 1st time on this forum in desperation for help.

I have a spreadsheet which does a number of very simple calculations, but for a particular set of numbers, seems to lose the plot. I have a simplification of the problem here if you could look at it.

In A1 place number 7.02
In B1 place number 7.07
In C!, calculate the difference between A1 & B1 ( =A1-B1)
In D1, place number 0.05 ( this will be a limit that C1 becomes reportable)
In E1, do calculation. =IF(ABS(C1)>D1," out of calibration","")

My problem is that the calculation works for all values placed into A1 & B1 except for the above example. In the example shown, calculation in C1 = D1, but fails. For any other values of A1 & B1 which result in C1=D1, calculation works.
Am I going mad?
Thanks.....Peter