It is much like a layer-3 switch. The switch interfaces are layer-2 interfaces, and they are configured for VLANs. The default VLAN is VLAN 1. For each VLAN you use, you can create and SVI (Switched Virtual Interface). You place the layer-3 VLAN configuration on the SVI, and the layer-3 address of the SVI is the gateway address for the VLAN. The SVI is like another router interface.
ip address 10.1.0.1 255.255.255.0
You can create multiple SVIs and assign different switch interfaces to different VLANs.
The router will automatically route between directly connected networks, so it will route between your virtual and physical interfaces.