Testing Library in Android

Given:

• a custom library as a module.
• an app that depends on this library.

I want to apply testing on this library. I searched online and found this on Android documentation:

Testing a Library Module There are two recommended ways of setting up testing on code and resources in a library module:

You can set up a test module that instruments an application module that depends on the library module. You can then add tests to the module for library-specific features.

You can set up a standard application module that depends on the library and put the instrumentation in that module. This lets you create a self-contained module that contains both the tests/instrumentations and the code to test.

Is there any example or so to show how testing a library would work out? Best practices for testing library?