Snapshot boundary: fictional example
HOST: physical computer and existing operating system
  Downloads/photo.txt: outside the snapshot
  Hypervisor: software managing the virtual machine
    GUEST: separate operating system and normal virtual disk
      B0: plan.txt contains first draft
      Later: plan.txt contains second draft
      Restore B0: plan.txt returns to first draft
REMOTE SERVICE: outside the snapshot

A powered-off snapshot includes no running memory.
This example includes the normal guest disk and excludes host folders.
Other disk modes may behave differently.
The guest disk and snapshot still depend on files on host storage.