When Site A links to your web page, Google sees this as Site A endorsing, or casting a vote for, your page. Google takes into consideration all of these link votes (i.e., the website’s link profile) to draw conclusions about the relevance and significance of individual web pages and your website as a whole. This is the basic concept behind PageRank.
When a website links to your site, or when you link internally from one of your pages to another, the link passes PageRank points. This passing of PageRank points is also commonly called “link juice” transfer.