Callback function parameters

I have been following a Node.js tutorial. I always had a doubt in my mind how data are passed to a callback function parameters. As an example

 User.addUser(newUser, (err, user) =>{
    if(err){
        res.json({success: false, msg:'Failed to register new user'});
    } else {
        res.json({success: true, msg:'User registered'});
    }
});

and addUser function is defined as,

module.exports.addUser = function(newUser, callback){
    bcrypt.genSalt(10, (err,salt)=>{
        bcrypt.hash(newUser.password, salt, (err, hash) => {
            if(err) throw err;
            newUser.password = hash;
            newUser.save(callback);
        });
    });
}

I don't understand how err and user are passed. Can someone explain this?

via Hashan Darshana