"In the garden".. Is it a phrase or clause?
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i think it is a phrase not clause

The theme this passage helps develop is:

D) One is often surprised by misconceptions about others.

Explanation:

The passage we are analyzing here is an excerpt from Chapter 6 of "The Hobbit", by Tolkien. Bilbo is a hobbit who's been taken on a journey by Gandalf, a wizard, accompanied by dwarves. The dwarves see Bilbo as useless and are upset at Gandalf for bringing him along with them. Bilbo is supposed to be an excellent burglar, smart and skillful. When he gets separated from the rest of the group, the dwarves are angry, thinking of him as a burden. But Bilbo returns to them having obtained the ring they were looking for. That fact and the many adventures Bilbo has to tell change the dwarves' opinion. They realize they have judged him too quickly and erroneously.