No sound on MacBook Air

Question

So here's my issue:
- Started MacBook Air from sleep
- Kernel panic - message on screen saying that I had to restart my computer by holding the power button
- No sound after restart
- Did nothing out of the ordinary before
- When sound buttons on keyboard are pressed, flashes level indicator but is greyed out and will not change
- Greyed out speaker icon on menu bar
- "No output devices found" in Sound in System Preferences
- Flash videos in all browsers load but only play for around 11 seconds (Chrome, Firefox, Opera) or three seconds (Safari) before stopping, but video is not paused and continues to load
- No red light in headphone jack
- Tried restarting
- Tried starting in Safe Mode
- Tried Apple Hardware Test
- Tried PRAM zap
- Tried repairing permissions
- Tried re-installing OS X Lion
- Tried Software Update
- Tried deleting BezelServices preferences file
- Tried plugging in earphones
- Tried cleaning with OnyX
Hardware issue? How much would it cost to get fixed? Go to Apple store or reseller? Any help would be appreciated. This is really bugging me.

Answer 1

If you're able to boot, launch the Console application in any of the following ways:
☞ Enter the first few letters of its name into a Spotlight search. Select it in the results (it should be at the top.)
☞ In the Finder, select Go ▹ Utilities from the menu bar, or press the key combination shift-command-U. The application is in the folder that opens.
☞ If you’re running Mac OS X 10.7 or later, open LaunchPad. Click Utilities, then Console in the page that opens.
Select the most recent panic log under System Diagnostic Reports. Post the contents — the text, please, not a screenshot. In the interest of privacy, I suggest you edit out the “Anonymous UUID,” a long string of letters, numbers, and dashes in the header and body of the report, if it’s present (it may not be.) Please don't post "shutdownStall" or "hang" reports.
If you can't boot in the usual way, try a safe boot. The instructions provided by Apple are as follows:
Be sure your Mac is shut down.
Press the power button.
Immediately after you hear the startup tone, hold the Shift key. The Shift key should be held as soon as possible after the startup tone, but not before the tone.
Release the Shift key when you see the gray Apple icon and the progress indicator (looks like a spinning gear).
During startup, you’ll see a progress bar, and then the login screen, which appears even if you normally log in automatically. You must know your login password in order to log in. If you’ve forgotten the password, you will need to reset it before you begin.
Safe mode is slower than normal, and some things won’t work at all.
Note: If FileVault is enabled under Mac OS X 10.7 or later, you can’t boot in safe mode.