Technology: Junit latest version Application is business oriented
Some people use hard coded data for test case some use properties files and some xml files. As per my knowledge xml is better than other two. Is there some better approach in use in industry. Please suggest best practice to develop test cases.
It is important that the mapping between data representation in the test and data passed to the function being tested is as transparent as possible. Hard-coded data is totally ok if the data are few and easy to observe right in the source. The fewer windows you need to keep open to understand a test case, the better.
XML is best for nested, tree-like data, but it's a bit wordy. YAML may also be good for this. For flat data, properties and just line-organized files are ok.
There's no single format which is superior to all others in all ways. Choose the easiest and most natural for a particular test suite / subject area. Investing some effort in handling the most natural format does pay when you need to quickly produce more and more test cases, and then again when you investigate a regression. E.g in our project (quite large) we had to invent several data representations and write (simple) custom parsers just to make writing and reading data for test cases a breeze.