2 entries and exits

I have M type 2-entries, duration of stay is 14 days. I will have an application for extension of another 14 days here in China, what is the next step to do? I will need to exit China? Will I need to go back to where country I came from? Or can I do the exit in Hongkong? How about the Visa? Is there any problem if I exit in Hongkong and re-enter China for my 2nd-entry? Do I need to apply for a new one if I exit from CHINA?