Stage 3 generally picks up from where Stage 2 finished, i.e. you're in the Enter New Requisition dialog's Submit button, as in the following screenshot:
If you're right-clicking Submit and do not see an Add Ancestor Reference option, I'm guessing you are not in the above situation, but rather in a separate model editor displaying only the Submit button, without its parent displays - there are various ways in which you could open any model in a separate editor, for instance, while in a parent right-clicking a child and selecting Open in a New Tab.
The Add Ancestor Reference feature requires that you zoom in to the Submit button in an editor where the ancestor you wish to add is accessible.
For best results, use the Firefox browser..