"Totals and averages are normally distributed." - Informal statement of central limit theorem.
This calculator calculates sampling-distribution parameters (expected value and standard error) from the population parameters (population mean and standard deviation). Those sampling-distribution parameters are used to calculate normal probabilities. Notice the population does NOT need to be normal, but then the probabilities are approximations (better with larger n). If the population is discrete, you should consider continuity corrections to the boundaries.