Dummy Payment Processor does not work

I have reproduced this issue in the Drupal7 CiviCRM public sandbox.

Steps:
1) Set up the "Dummy" payment processor as the only active payment processor in the system. Fill in all configuration fields.

2) Click the "Create New" button on the left column and choose "Contribution (credit card)"

You will see the error message:
"You will need to configure the live settings for your Payment Processor before you can submit credit card transactions."

(URL:
http://drupal.demo.civicrm.org/civicrm/contribute/add?reset=1&action=add&context=standalone&mode=live )