A word arrangement, when rearranged by given input follow a particular rule/logic in each step.Following is an example of input and rearrangement. Study that rule/logic and apply on given problem.
INPUT: man’s mood varies with time and environment
Steps/Results:
I. Varies with man’s mood environment and time
II. And time environment mood man’s varies with
III. Environment time and varies with mood man’s
IV. And varies environment time man’s mood with
If Step IV reads, 'everyone was aware about their beautiful friendship', what will be the three middle wordsof Step II?

Since the question is only considering the 4th and 2nd lines,

Let us consider the third line of the illustration and arrange the 4th and 2nd lines accordingly.

III. Environment time and varies with mood man’s

Let Environment - 1, time - 2, and - 3, varies - 4, with - 5, mood - 6, and man's - 7.

Now, the coded version of III will be 1234567.

From the illustration, the code IV will be 3412765 and II will be 3216745.

Now after applying a similar code pattern in Step IV of the asked question, step II will be

Everyone about aware beautiful their was friendship.

Thus, the correct answer is B.