Pass-through authentication

I create an ASP.Net Web Forms site named 'Asite' using Visual Studio 2012 Express. 

In IIS8 I select the site > Basic Settings.  The Edit Application window opens showing:

  Application Pool .NET v4.5
  Physical path: C:\inetpub\wwwroot\Asite
  Pass-through authentication

I click "Test Settings..." and get:

   Test                                  Setting 
(OK icon) Authentication       Pass-through authentication (.NET v4.5:ApplicationPoolIdentity)
(ERR icon) Authorization        Cannot verify access to path (C:\inetpub\wwwroot\Asite)

I  click 'Edit Permissions' to open Asite Properties.  Under Security tab full control is setup for <mycomputer>\Users and for <mycomputer>\IIS_USRS. 

Why would I get the Authorization Error (it's a warning error)?

I also note that the General tab of Asite Properties has attributes: Read-only.  I have tried to change this attribute, and the change seems to be applied, but when I close and reopen Asite Properties the Read-only box is still checked.

Thanks for enlightening me.