You smack the little bastard corresponding to the keys on your number pad.
I have been playing for the last fews days, mastering it up to level 14, so here are some tips:
-If you look next to your hammer, you see a pie chart, with some of it filled in. This is how much damage you do with each hit.
-At the start of each level, a pie chart will appear under each new enemy, telling you how much damage they take before being killed.
-The eyeballs with the number in them: You press the number on the keypad that is shown in their eye when they open up.
-After you kill enemies, sometimes a coin will appear. Hit it again to collect it. You can use this in the store.
-Every once in a while, a little house will pop up instead of an enemy. If you hit it, you will go to the store.
-There are 3 hammers you can purchase. Each does more damage with each hit.
-The wings (80 coins) allow you to strike enemies as fast as you can push the keys. This is definately needed in the later levels as things speed up.
-I recommend purchasing the silver hammer first, once you can afford it.
-After purchasing the silver hammer, you can strike the ball and chain (the one just laying there) and you will get a heart. This will help you get further.
With all that out of the way, here are some more tidbits which may help.
-The enemies with their eyes closed normally steal 1 coin from you if you hit them. However, with the gold hammer you can kill them and get 2 coins from them. If you use the silver hammer, it takes 2 shots to kill them, effectively giving you 1 coin.
-The ball-and-chain enemies (not the guys swinging them) will give you a heart when you kill them. both the gold and silver hammers accomplish this with one hit.
-I'm drunk
-After level 10 everything just gets faster and faster... no new enemies.
Have fun!