How does a computer process data into information?
As you input information into the computer, at the lowest level, all the computer understands is binary language (0's and 1's). See our binary and machine language pages for further information about how binary works.
After a computer has received input data, a program is used to process that information. A typical program may calculate, manipulate, or organize the data to create information that is understandable and presentable to the user.
Finally, the computer can store the created information for later use.
A real-life example of how data is processed
As a real-life example of data being processed into information, imagine the following scenario. You open a spreadsheet program on your computer and enter the data "1.25" into the first cell. Initially, the computer understands this data only as the floating point number 1.25. Using the spreadsheet program, you can specify the data to be formatted as currency, so the computer understands as "$1.25" (one dollar and twenty-five cents).
You could input the data ".75" to another cell, and again format as currency ("$0.75"). Then, you could input a formula in a third cell that adds the values of the information in the first two cells. This formula would return the new information "$2.00." Or, the formula could convert the amount to another currency unit. For instance, if one dollar is worth .89 euros, the formula could convert "$2.00" to the new information "€1.77."
After all of the data is processed, the spreadsheet program can save (store) the file, allowing it to be opened again to add additional data.