can't drag jrxml into Detail band to create subreport

Using iReport 3.7.1.1 on Windows. You cannot create a subreport as indicated in the JasperServer Pro User Guide, page 107-108:

5.4.2 Creating a Report Unit in the Repository from iReport

To add a subreport to a report, drag the JRXML for the subreport from the repository into the detail band. The JRXML for the subreport must already be created and saved as a resource in the repository or in the report.

A sub-report element is created. If the main report uses a JDBC connection, set the connection expression of the subreport

to $P{REPORT_CONNECTION} in the Properties window’s subreport tab.