
Explanation:

Box 1:User1 and User3 only
You must use Windows Server Active Directory to update the identity, contact info, or job info for users whose source of authority is Windows Server Active Directory.
Box 2: User1, User2, and User3
Usage location is an Azure property that can only be modified from Azure AD (for all users including Windows Server AD users synced via Azure AD Connect).
Reference:
https://docs.microsoft.com/en-us/azure/active-directory/fundamentals/active-directory-users-profile-azure- portal