Press the switches to change the value of the "binary" variable. You can see what the value is in decimal in the "decimaI" variable. You can see if a switch is on or off by looking at the variable above it.
2^0 is the furthest left, and 2^7 is the furthest right. You'll understand this project a lot better if you know how to count in binary: https://scratch.mit.edu/discuss/youtube/LpuPe81bc2w