The four main components of the eye that are responsible for producing an image are the cornea, lens, ciliary muscles and retina. Incoming light rays first encounter the cornea. The bulging shape of the cornea causes it to refract light similar to a convex lens. Because of the great difference in optical density between the air and the corneal material and because of the shape of the cornea, most of the refraction to incoming light rays takes place here. Light rays then pass through the pupil, and then onto the lens. A small amount of additional refraction takes place here as the light rays are "fine tuned" so that they focus on the retina.
Vision is dependent on the stimulation of nerve impulses by an incoming light photon, which only real images are capable of producing. The resulting image produced on the retina is formed by the actual convergence of light rays at a point in space and is, therefore, a real image. The resulting image is also inverted and reduced in size, as to allow the entire image to fit on the retina. The brain compensates for the inversion and interprets the signal as originating from a right side up object and produces the "flipped" image that we see.
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