You should solve it algebraically as follows:
Let the cost of the pencil = P, then:
The cost of the pen =P + 1. So, we have:
P + P + 1 =$1.10
2P + 1 =$1.10 Subtract 1 from both sides
2P =$0.10 Divide both sides by 2
P =$0.10 / 2
P = $0.05 cents - the cost of the pencil
$1 + $0.05 =$1.05 - cost of the pen.