From what I remember from my very few Japanese classes, it says "Woof goes squishy, Meow goes squishy" then the cat with the phone is a joke because "moshi moshi" (a phrase you say when you pick up the phone) sounds like mochi mochi, same with the granny picking up the phone later on. I don't understand the rest, though.
https://youtu.be/5DyCK8bpTmo