No sound after 10.8 update

I have the 2011 Quad Core iMac, after upgrading to 10.8 I no longer have any sound output devices showing up. There is no red light coming out of the headphone jack, I have already cleared PRAM/SMC and it doesn't help, with that being said, when I hold Command, Option, P, R everyone says "let it go after x beeps" problem is, I don't hear any beeps because the speakers aren't sending sound. I also am unable to hear sound if I plug in headphones, nothing shows up on the Output Device menu there either.
I have the ability to adjust the volume (but hear no clicks).
Any suggestions?

 

I have tried creating a new user account thinking maybe it was something on the local user. After creating new user I rebooted and logged straight in with no luck there either. I have not yet tried the fresh install of ML yet, I was going to see if anyone here had any suggestions prior to that. I have backed everything up prior to posting this in the event that it was my last resort and if I had to possibly take it back to Apple to look at. I was hoping that Time Machine isn't going to grab the issue if it is a library or driver issue.

 

I have completed a fresh install of 10.7 just to see if that would fix it and it was also a no go. Fully updated etc, it seems like the problem almost expanded, now the volume controls don't work and look like the attached pic. It appears as though I will have to go to Apple tomorrow unless someone else has any other suggestions. Also, still seeing no output devices in sound prefs.

 

That is indeed what I was afraid of, luckily it is under warranty still! I wish the new models were out, might get lucky and receive one of those!

 

After installing ML it had completely removed the Internal Speakers from the Output device list, the only thing I had listed was the LogMeIn one after. That was my initial thought as well, was that it had just swapped. Then I saw that it indeed had disappeared. I am assuming it just isn't reading the hardware right. In your guy's opinion, is this a logic board and speaker replacement or are they going to replace the entire iMac?

 

I had read somewhere else that someone ended up having to pay because Apple blamed it on a Software issue also, mostly the reason I went back to 10.7 and just fully updated it. I believe I am just going to stick to the story of "Turned it on and it just happened" that everyone likes to play. IMO this isn't a software issue, especially since I fully reinstalled and it still doesn't function, I don't even have the Apple "BONG" when I turn it on. I am kind of upset this happened this weekend as I have a ton of stuff I needed to get done on it, but I don't have another day in the future to take it in. Fingers crossed they just give me another one and don't "troubleshoot" for the next 5 days.

 

Well, took it in and they ran hardware scans but saw no issues, he couldn't get it to work with anything and said that me clearing PRAM and doing a fresh install obviously didn't help so he sent it off to be repaired. Unless they find anything additional wrong with it, it looks like it is costing them around 600$ (logic board, audio cable, labor) odd to me that they didn't put down "possibly speaker issue" because of the speakers werent initializing it still wouldn't work. Who knows, guess well find out in a week! Was really hoping to just swap it so I didn't have down time. Oh well atleast it's 600$ out of their pocket and not mine.

 

So, I'm not sure of its a miracle or not, but somehow I dropped it off Friday evening 5:30PM to have it repaired, it was suppose to be shipped to the repair facility and take 3-7 business days to be back and ready for pickup. I received an email this evening (around 6:00pm) stating that it was ready to be picked up. I can't decide if they found more issues and are just bringing me in to replace it or if they actually are that good and were able to ship it off, have it repaired and shipped back? Seems impossible considering it would have been received Saturday some time, so how would they have fixed it and we're able to deliver it back? They don't occasionally fix them in house do they? I was pretty sure he said something about "send it to the repair facility".

 

Well, after standing there for 45 minutes I have finally gotten my computer back and apparently the logic board and the audio cable being replaced solved the issue. Brought it back home and everything is working great.