Hello I send the picture of the exercise and the solution I found, I wonder why instead of just multiplying by the percentage 10% =0.10 or 6%=0.06 that the exercise asks for, in the solution they multiply it by 1.10 and 1.06. I don't understand why, thanks for helping me

24 The Easecom Company is a manufacturer of video conferencing products. Regular units are manufactured to meet marketing projections, and specialized units are made after an order is received Maintaining the video-conferencing equipment is an important area of customer satisfaction, With the recent downturn in the computer industry, the viejo-conferencing equipment segment has stand. loading to a ducting in Expocom's financial performance. The following income statement shows nopults for the your 19-7: Income Statement for the Easecom Company for the Year Ended December 31, 19-7 (in thousands) Equipment $ 6.000 Maintenance Contracts 1/800 Total revenues Cost of gooch told Gross margin 350 Operating costs Marketing Distribution 150 Compania Easecom Customer maintenance 1,805 Estado de resultados Administration Para el ano que termino el 31 de diciembre de 2011 (en millares) INGRESOS Total operating costs 2.650 Equipo (1.10*1.06*6000) $6 996 Operating Income $ 650 Contratos de mantenimiento (1.06*1800) 1 908 Total de ingresos $8 904 COSTO DE LOS BIENES VENDIDOS (1.03*1.06*4600) 5 022 UTILIDAD BRUTA 3 882 Ensecom's management team is in the process of proparing the 19-8 COSTOS OPERATIVOS budget and is studying the following information: Marketing (250+600) 850 a. Seling prices of equipment are expected to increase by 10%% Distribucion (1.06*250) 159 as the economic recovery begins. The soling price of each Mantenimiento al cliente (130+1000) 1 130 maintenance contract is unchanged from 19-7. Administracion 900 b. Equipment sales in units are expected to increase by 8%, with a Total de costos operativos 3039 corresponding 67% growth in units of maintenance contracts c. The cost of each unit sold is expected to increase by 3% to pay for the necessary technology and quality improvements. d. Marketing costs are expected to increase by $260,000, but administration costs are expected to be held at 19-7 levels. e. Distribution costs vary in proportion to the number of units of equipment sold. 1. Two maintenance technicians are to be added at a total cost of $130,000, which cover wages and related travel costs. The objective is to improve customer service and shorton response tim g. There is no beginning of ending inventory of equipment. REQUIRED: Prepare a budgeted income statement for 19-8