Problem SOLVED. It was due to older files I located using Terminal app. I 
deleted everything related to LyX (rm -R LyX*) on the system and reinstalled 
LyX2.1.1 and float figure started to work. Stephan thanks for your time.

>> Hello,
>> After migrating to a new MacBookPro (OS 10.9.4) and downloading LyX2.1 my 
>> book figures started to be UNDEFINED. Also in New documents (KOMA Script 
>> Book or other book classes) "Insert>Float>Figure" has the same problem; it 
>> creates UNDEFINED figures as shown below. I reinstalled MacTeX2014 and then 
>> LyX2.1 but could not solved the problem. Reconfiguring and using different 
>> Book Document Classes did not help. I tried online info and help before 
>> submitting this request. Any help would be greatly appreciated.
>> Thanks.
> Hello,
> I'm not sure if I can help you, but I'd like to see a small LyX file with the 
> problem.
> Please, send a minimal example to the list.
> Stephan

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