You can buy toys for Bubble Puppy by redeeming your bones in your Doggy Bag. Just select the doggy bag icon on the upper left corner of the screen.  

Each toy is worth a certain number of bones.  

To purchase a toy, tap on it. You can unlock that toy by dragging the bones from your Doggy Bag to the bone slots below the toy.

Once you have bought the toy, you will see a green check mark.