IF function and circular reference

dear all (A file is attached)
i am facing a little trouble. i got three cells namely; M7, AC7 and BA7. Initially, an input value is entered in cell M7 which will be processed to give AC7. An IF function is entered in cell BA7. This IF function is really simple. It states that IF the difference between the values of M7 and AC7 is greater than 1 then, decrease 0.01 from M7, otherwise, retain the value of M7. The syntax is:
=IF((M7-AC7)>1, M7-0.01, M7)
As I told you, it is really simple and looks fine. I have no problem with it so far. The problem came about when I tried to make the circular reference. I am trying to make M7 to equal BA7. Well, before I made the circular reference, I made a manual entering of the values of cell M7. What I have done was that I put a value like 29.94 in M7 then I let the calculation to proceed. The the value that I get in BA7 (i.e. 29.93), I re-entered it in M7 then I repeated the process until I got a value (i.e. 29.90) that was not changing due to the use of the IF function. The manual calculations are shown in Table2 of the attached file.
I said to myself instead of entering the values manually, I can use a circular reference so that the cell M7 = cell BA7. Unfortunatelly, the circulation of the values instead of giving me 29.90 which is the right answer, it gave me 29.89 which ment that Excel has done one more step further of the IF function. In other words, Excel should have stopped decreasing 0.01 from M7 when M7-AC7 was less than one. This is achieved at M7=29.90 (as clearly seen in Table2). However, Excel went one step further and done: BA7=29.90-0.01=29.89 then it stopped subtraction at 29.89 which is not correct. I don't know why.
I tried with two other people to resolve this dilemma but we couldn't. Then, I decided to seek help from you if you can. If you want to ask any question for clarification I would be mre than happy to reply to you.