Welcome, Knut. Seen your name, I suppose Norwau is Norway.
The test light should come on when the 'F' mark on the advancer aligns with the mark in the crankcase. This is when the breakerpoint begins to open.
The secret is that, under normal circumstances, you do not have to move the plates at all. This is because practically all "off" timing originates at the breakerpoints.
Three causes:
1) The breakerpoints' little fiber 'heels', that follow the cam, are worn (lack of lubrication of the cam).
2) The points surfaces are worn
3) You have fitted new breakerpoints
In all three cases and under normal circumstances, you can regain a correct timing by simply adjusting the breakerpoints gap, although this gap has to be within 0,3 and 0,4 mm at its widest opening* .
If after setting the correct gap a correct timing still cannot be achieved by adjusting the plate(s), either your breakerpoints are severely worn or you have fitted aftermarket breakerpoints.
But... now that you have moved the plates already, I'm afraid you have to do the full procedure:
Start with the breakerpoints gap (as said the gap has to be within 0,3 and 0,4 mm at its widest opening*) and then set the plate(s). In that order.
*Let's take breakerpoint 1+4. To get to the widest gap opening of that breakerpoint, you need to turn the crank a 90o further. If you look through the peep hole, you will see more or less what's shown in the pic below. In the pic it is about a CB500, but the 350 is pretty similar.
Knut, what manual do you have?