Is there a way to extend standard domain entities? How to extend domain entities in plugin or in custom ClassLibrary project?

If you need to extend an entity, you must do it in the sources. You cannot extend a class with an additional field that is in another library

Could you please provide a sample for extending an entity in the sources please.
Also if it is something which modifies source code then how should we upgrade to a new version of a grandnode?

Hoping to get answers for these two.