Question

What kind of phrase is the underlined group of words?

The beach bag with the red handles is still outside on the deck.

A. adjective phrase

B. adverb phrase

C. appositive phrase
The underlined phrase is with the red handles
I think it is A

Answer 1

Correct, you could replace it by a real adjective:
The BIG beach bag is still outside on the deck.

Answer 2

Thank you @Vincent-Lyon.Fr