Okay, all files are binary, and that's it. An extension is usually used to identify meaning, but unless the file is in the right binary format, it's useless.
Make file creates an empty file with a name, and it's used to initialise a save file.
For example, if you wanted to write a program that saved a message to a file called "msg.txt", it would work like this:
IF FILE EXIST(GET DIR$() + "/msg.txt") = 0 THEN
MAKE FILE(GET DIR$() + "/msg.txt")
PRINT("Input message")
INPUT msg$
OPEN TO WRITE 1, GET DIR$() + "/msg.txt"
WRITE STRING, 1, msg$
CLOSE FILE 1
And that's all there is to it.
If you're wondering what GET DIR$() is, it's a function that returns the current directory your application is running in. Make sure if you test this code, you save it first.