At about 1445 mountain time, a Cessna 172P was substantially damaged after colliding with a berm during an attempted go-around from a simulated forced landing near Fountain Hills. Both pilots sustained minor injuries. The flight instructor was providing a check-out in the Cessna 172 to the recently certificated private pilot. Both fuel tanks had been filled prior to the flight. When the accident occurred, the CFI was in the process of simulating a total loss of engine power. The maneuver began about 3,500 feet agl by closing the engines throttle. According to the student, he applied full carburetor heat. The CFI turned the carburetor heat off, saying that it was unnecessary. Both pilots reported that the instructor cleared the engine by applying partial power at least two times during the descent. These procedures were uneventful. The CFI stated that he instructed the student to initiate a go-around at about 100 feet agl, but advancing the engines throttle produced no increase in engine rpm. According to the CFI, the student remained at the controls, and as he pulled the yoke aft the airplane stalled and the left wing collided with the ground. The airplane then landed hard in a dry wash. The student stated that he had initiated the go-around at about 350 or 400 feet agl, but at that time the CFI took the controls and again closed the throttle in order to continue the maneuver. According to the student, the CFI was at the controls for the remainder of the flight. At about 20 feet agl, the CFI initiated a go-around but the engines rpm did not increase in response to advancing the throttle. The left wing collided with the ground as the CFI banked left, and then the propeller impacted the ground. The flight schools policy requires that engine out simulations be terminated no lower than 500 feet agl. Also, there should always be a suitable field nearby in the event that a forced landing becomes necessary if engine power is not reacquired during the maneuver.