On December 9, 1999, about 1400 eastern standard time, a Cessna 172M, N9234H, registered to Carlina, Inc., dba First in Flight Aviation, experienced an in-flight collision with terrain near Pikeville, North Carolina. Visual meteorological conditions prevailed at the time and no flight plan was filed for the 14 CFR Part 91 instructional flight. The airplane was substantially damaged and the certified flight instructor (CFI) sustained minor injuries and the private-rated pilot sustained serious injuries. The flight originated about 18 minutes earlier from the Goldsboro-Wayne Municipal Airport, Goldsboro, North Carolina. The purpose of the flight was to have the CFI check the private pilot in the accident make and model airplane. The CFI stated that before departure for the airplane checkout flight, he briefed the pilot what airwork maneuvers were to be performed and that he would perform a simulated engine failure, then the flight would return to the departure airport where the pilot was to perform touch-and-go landings. The flight departed and the pilot performed slow flight, power on and off stalls to the left and right, and medium and steep banked turns to the left and right. While flying at 2,500 feet he first reduced carburetor heat then reduced the throttle to simulate an engine failure. The pilot picked an "excellent" field for the simulated forced landing but overshot the field. The CFI advised the pilot, "if he did a 180 to the left we would have it made. He made the turn with the flaps down and we were in excellent position to land. I told him 'we've got it made, lets get out of here, give it full power and go.'" He further stated that he couldn't recall if the pilot added power; the last thing he recalled was the airplane being in a wings level position about 50 feet above ground level. The airplane then impacted the ground first with the left wing followed by the right wing, and came to rest upright. The private-rated pilot being checked out in the airplane stated that he had never flown a Cessna 172 before the accident flight. He reported that the CFI advised during the briefing that he would perform in part a simulated emergency landing. The flight departed and performed airwork, then the CFI reduced the throttle to idle an advised him to execute a simulated emergency landing. He reported choosing a field which the instructor approved of then initiated the procedure. While on final approach to the field, he recognized that the flight was too low and that the CFI did not advise him to go-around. He reported applying power to go-around and attempted to go-around; ground impact occurred approximately 2 seconds after applying full power. Examination of the accident site by the FAA revealed that the airplane impacted first with the left wingtip on a northeasterly heading in the southern portion of a large open field of approximately 20-40 acres. The nose section impacted the ground 40 feet past the initial ground impact followed by the right wing and empennage. The airplane came to rest on a southerly heading approximately 90 feet northeast from the initial impact point. The nose landing gear was separated from the airplane and the right seat was broken from its seat tracks and resting outside of the fuselage. The outer 3 feet of both wingtips were displaced up approximately 45 degrees. The flaps were noted to be fully extended and examination of the flight controls revealed, "...all flight control cables are consistent and appear normal." The engine was removed from the airframe and placed in a test stand where it was started and found to operate normally. Copies of inspector statements are attachments to this report.