To record the payment received in cash, which type of documentation is the best practice?

A receipt is the best practice for documenting cash payments received because it serves as concrete evidence of the transaction for both the payer and the payee. Receipts typically include key details, such as the date of the transaction, the amount paid, a description of the goods or services, and the signatures of the involved parties, providing a clear and legally binding record of the exchange.

In contrast, a journal entry is an internal accounting record that reflects the transaction but does not provide verification or acknowledgment from the customer. An invoice is a request for payment issued before the cash is received and does not serve as proof of receipt. A bank statement, while it shows overall cash flows in and out of a bank account, does not contain specific details about individual transactions like a receipt does. Therefore, a receipt offers the precise and official documentation needed to confirm the payment received.