A complete tutorial is available here.
Start by opening Smart Notebook and clicking on the Gallery tab. Search "Balloon Pop" and it should come up. The tutorial should explain everything else, so I won't recreate it here.
Tips for using this tool:
1. Notebook works in layers, as in each item you put on the page will be layered over the next. So if you put the balloon on the page before you put the answer to be covered up, the answer will not be hidden by the balloon because it is layered over the balloon. This is fixed by right-clicking the balloon, select "order" and then "bring to front". Now the balloon is the top layer.
2. The tutorial asks that the "Lesson Activity Toolkit 2.0" be downloaded. This should be downloaded already if your software is up to date. For more info, on the tools available in this toolkit check out this Notebook.
Now you have one more trick in your book for making lessons interactive!