#2
the one in the lower cutaway is a master volume control.

then in the usual position for controls (by the F-holes) you have a master tone control and individual volumes for each pickup. this allows you to get the balance of the volumes between the pickups exactly how you want it and then control the overall volume with the master volume control.

and of course the toggle switch is a pickup selector.
Rig Winter 2017:

Fender Jazzmaster/Yamaha SG1000
Boss TU-3, DS-2, CS-3, EHX small stone, Danelectro delay
Laney VC30-112 with G12H30 speaker, or Session Rockette 30 for smaller gigs
Elixir Nanoweb 11-49 strings, Dunlop Jazz III XL picks
Shure SM57 mic in front of the amp