Source refers to where (which state) is the income is derived from?  For your California return, income you earn in California is California sourced income (you will put California in the box).  If you received income that was not from California you can use Nevada (or the state the income came from) sourced income or "Non-California" sourced income.  The question is to determine the income California can tax and the income they cannot.  If all of your income is from California, it is all California Sourced.