If I set out where these terms originated, I think it will give you a better insight into why CBs does what it does and why there are two procedures open to you depending on how you want to run your books, ie there is no "correct" procedure.
In traditional bookkeeping when a customer paid you, you would make a double entry in your books to add the money in to your cash book (ie your internal bank record) and then to pay off the unpaid invoice in your Sales Ledger (ie the book recording invoices sent out and money to pay them off).
Then, as a second stage, when the bank statement arrived at the end of the month, you would run down it and tick off all the entries on the statement with the entries in your cash book and this process was part of the "Bank Reconciliation".
In CBs, and other systems which allow the import of bank statement lines every day if you want, the above two processes can take place in one go but in reverse order, ie you are lead from the bank statement. So the process is:
Upload bank statement (This just gives you pages of bank statement entries so, at that stage nothing has been entered in the books).
Click on each line and tell "EXPLAIN" to CBs what it is, which, in your example, is allocating the amount against the one (or many) unpaid sales invoices.
Once happy, hit Add transaction and this stick it in the books and covers the two manual steps noted above, ie both making the book entries and ticking off the entries in the bank record. So, if you then open the bank account record, you will now see the entry in the account with a green tick next to it.
Many businesses however (maybe >50%) still want to follow the two stage method for some entries, ie they want to make a manual entry in the books before the bank statement arrives. The benefit of this is that if you only upload your bank statements every month, you still want to record the fact that your customer has paid off their invoice, (or you have paid off a bill) otherwise you could end up chasing them again in a couple of weeks time (or paying the bill twice - I've done this!).
In such a situation the process for these items is as follows:
Go to the invoice screen and use the quick pay boxes to show that it's been paid off. This puts the entry in the bank and sales records (ie the first manual stage noted at the start).
Upload the bank statement and hit the entry to explain it only this time, you'll not see an unpaid invoice to allocate the payment against, you'll see the Invoice with a PAID against it and a "reconcile" link.
Hit the reconcile link and this puts the green tick next to the entry in the bank record.
Because the transaction has already been entered by you days or weeks previously, there is no need for an Add transaction stage.
So it's entirely up to you, use the first method, or the second method or, perhaps like the majority of businesses, a mix of both.
Personally, in my own books, I find the second method long winded and, if I have a period where I have already entered most of the entries (in & out) the books I don't bother to upload the bank statement. All I do is look at the bank statement and manually enter (via manage money) the few remaining entries, not already in the books, then I go straight to the bank record and manually enter the green ticks against all the entries. You do this by hitting the select checkbox next to each entry and, you guessed it, hit the "reconcile" link at the bottom of the screen, they will all then appear with green ticks.
Finally, this area is being redeveloped at the moment to make the above processes easier and far more intuitive, so watch this space.
Hope that helps