Volume Mixer in Windows 7,not just show device volume but also lists all applications that are currently running and producing the audio.You can control the audio of any of the application from there on.So when you are having more than one application that is producing sound you can control from here and stop it as well.

@ the time when i snipped the screen, there were few applications running on my system, Yahoo Messenger, Google Talk, few media players Windows Media Player, VLC Media player, Quicktime and one video clip was also being played in Windows Live photo gallery (yes it can play Video as well apart from Images)