MacOS VirtualBox – Not Enough Free Space on OS X Base System While Installing El Capitan

disk-utilitymacosvirtualboxvirtualization

I am getting an error while installing OS on Virtual Box machine, that there is not enough free space as shown in the image. I allocated 20GB while setting up virtual machine, and 8.8GB is what apple says that I need here

enter image description here

I went to disk Utility->Disk Utility of VirtualMachine and tried changing partitioning of the VM. It cant be done. It also shows the instructions I need to take, but the "Enable Journaling" command is greyed out. What could be the problem?

It also says I am using CD ROM media, but I am not. The El Capitan iso file, that was linked to VM in the Storage tab of setting up VM, is on Desktop.

These are the screenshots for better illustration.

enter image description here
enter image description here
enter image description here

Best Answer

By accident I tried to install OS X to the OS X Installer DVD iso file (mounted to the virtual VBOX CD-ROM device) itself.

Erasing/partitioning the VBOX HARDDISK disk (see images in question) and creating a new HFS+ Journaled formatted volume seems to work.