(N/A) The ray diagram for the formation of the image of the phone is shown in the figure.
Since the mobile phone is placed along the principal axis,different parts of the phone are at different distances from the pole of the mirror.
The magnification $m$ for a spherical mirror is given by $m = -v/u$.
As the object distance $u$ varies for different parts of the phone,the image distance $v$ and consequently the magnification $m$ also vary for different parts.
This leads to non-uniform magnification,causing the image to be distorted.
Yes,the distortion of the image depends on the location of the phone with respect to the mirror. If the phone is moved closer to or further from the mirror,the range of $u$ changes,which changes the range of $v$ and the degree of distortion.