I've just opened a new image and am unable to access any functions on the "Layers" menu -- every option is grayed out... Not sure what to do.
Does this happen with just this image, what happens if you do file >> new and try to make new layers?
If this is not working try resetting your Photoshop prefs.
Check Image > Mode
If set to Indexed Color, change to RGB
Thank you, that solved the problem! I still seem to need to change a setting of some sort to work with this file. I'm working with a scanned b&w drawing and am unable to adjust the levels. When I choose "adjust levels", the Levels window pops up and I'm able to preview changes, but when I click "OK", nothing happens; no changes.