Color theory is a complex subject dealing with how color represented, interpreted by programs, generated by output devices, and perceived by humans. The articles here detail how Photoshop handles color theory.
“Colour modes are the basis for the representation of a pixel's colour value. Between different...Color mode
“A color profile determines how an output device (i.e. monitor, printer) will interpret the color...Color profile
“Color correction is the process of applying adjustments to an image to resolve variations in...Color correction