Lets have an example scenario:
Client opens a web site and finds the sum of two numbers which he enters from the textboxes.Then clicks on the ADD button.Two parameters a
A webservice is equivalent to a method in java that has a web wrapper around it. It lives on the server and it can be sent data / queried etc. and may or may not return a result. It does not have any front end it can only be accessed via http get, put, delete etc.
A web Application is a fully functional piece of software that lives on a sever that is designed to help people achieve a task. This would have a front end that would allow users to interact with it / enter data etc.
A web application could use multiple webservices to achieve its goal / end result