Once you have test account of authorize.net, you need to do following settings in magento admin.
Magento admin > System > Configuration >sales > Payment method > expand Authorize.net
Here, you need to enter your test account's Login Id and Transaction key.
The most important configuration is Gateway URL for test account.
For Test account Gateway URL is:
If you do not change gateway url for test account then magento will show following error and you will not able to finish transaction:
The merchant login ID or password is invalid or the account is inactive.
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