GeneralBinary Question..Please Look

I'm fairly new to programming, so bare with me. I'm trying to figure out in my head what is actually stored when I save data using, for instance, notepad. Let's say I store the letter 'M'.
I know 'M' is represented as 77 in ascii and 1001101 in binary. Under the hood, is the binary number 1001101 stored on disk, and when I ask notepad to open the file, it converts it to ascii, back to a character? Hope this makes sense..

Thanks

EVERYTHING in computers is stored in binary. ASCII is just a way of interpreting the binary. Hex is a shorthand for the binary. Octal is another shorthand for the binary. Decimal is a way of interpreting the binary. Text is a way of interpreting the binary. Floating point numbers are a way of interpreting the binary. EVERYTHING is binary.

The question is NEVER whether or not something is stored in binary but rather how the conversion is done to/from binary into and out of stuff that we humans find more convenient.