John indicates that he cannot edit the file Test.

The screenshot shows that John Douglas is explicitly denied "Read & execute" permissions on the file Test.docx, which overrides any inherited allow permissions. To allow John to edit the file, you must modify the NTFS permissions on the file and remove or change the Deny rule that applies to his account. Simply allowing "read & execute" would not be enough; you must grant "Modify" or higher and remove the Deny.