The correct option is B 1 - False, 2 - False, 3 - True
Cutting a log of wood into pieces is a physical change as there is no change in the chemical composition of the wood while cutting it. Hence statement 1 is false.
The formation of manure from leaves is a chemical change as the chemical composition of manure is completely different from that of leaves. So statement 2 is also false.
Condensation of steam is a physical change as during condensation of steam, there is only a change in the physical state of water from the gaseous state to the liquid state. There is no change in the chemical composition of water during the process of condensation. So statement 3 is true.
Therefore, the correct option is A.