The 2\'s complement of a number which is represented by N bits is 2^N-number.
For example: if number is 7 (0111) and i\'m representing it using 4 bits then, 2\'s comple
The +1 is added so that the carry over in the technique is taken care of.
Take the 7 and -7 example.
If you represent 7 as 00000111
In order to find -7:
Invert all bits and add one
11111000 -> 11111001
Now you can add following standard math rules:
00000111
+ 11111001
-----------
00000000
For the computer this operation is relatively easy, as it involves basically comparing bit by bit and carrying one.
If instead you represented -7 as 10000111, this won't make sense:
00000111
+ 10000111
-----------
10001110 (-14)
To add them, you will involve more complex rules like analyzing the first bit, and transforming the values.
A more detailed explanation can be found here.