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I am looking for a best practice approach. I am working on a module extension, which involves creation, retrieval and deletion of an entity(object).

I have created the DAO files for them, I am looking to the write place to write insertion and selection queries. Currently I am confused about writing them in a BAO file or the API functions.

Is writing this code directly in API functions a bad approach, and having a BAO is a necessity. Also, if we create a BAO is there a guide I should follow about what to do and what not to do.

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The BAO is not required, but it is what we always used to do. So the standard approach is: the API uses the BAO/DAO functions to insert and select. You can find a pretty simple example here: https://github.com/CiviCooP/no.maf.oppgavexml/tree/master/CRM/Oppgavexml

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