Let the principal be x.
It is compounded (incremented)annually by 10% or 1.1*amount
at the end of year 1, amount $\therefore$ x*1.1 = 1.1x
The second year's compound interest is 132 (@10% of amount of year 1)
$\therefore$ 10% of 1.1x = 132
0.11x = 132
x = 132/0.11 = 1200
1200 = x = principal amount.