My friend keeps telling me that he is increasing his Ra's ATK & DEF points by using Ra's "Pay 1000 LP, destroy 1 monster on the field" effect. I'm wondering if that is the case or if Ra can only increase ATK & DEF points when he's summoned.
The card text on Winged Dragon of Ra (the playable one with effect text) specifies that the only timing for increasing Winged Dragon of Ra's attack and defense is when it is normal summoned. This is a separate effect from the monster destruction effect.
When this card is Normal Summoned: You can pay LP so that you only have 100 left; this card gains ATK and DEF equal to the amount of LP paid.
This sentence, in Problem-Solving Card Text format, describes a single optional effect of the Winged Dragon of Ra. It specifies a timing (when Winged Dragon of Ra is Normal Summoned, as indicated by the colon), a cost (paying enough LP to lower the current player's LP total to 100, as indicated by the semicolon), and an effect that occurs if that specific cost is paid (Winged Dragon of Ra's ATK and DEF increase by the amount of LP paid at summon time).
As for Winged Dragon of Ra's other effect:
You can pay 1000 LP, then target 1 monster on the field; destroy that target.
This describes a separate optional effect with no specific timing but with a cost AND targeting (as indicated by the semicolon). The effect also destroys the target and does absolutely nothing else because no other text is a part of that effect, even if it would lower the player's LP total to 100.