I am using SW2014 SP5.
You can IF the dummy parts are "virtual" in the assembly. However, if the dummy parts are not virtual and simply have no geometry, then unfortunately this option vanishes from the balloon property manager. I have yet to find a preferable method for ballooning the latter type.
I'm using Solidworks 2015 SP5.0.
The components I'm wanting to balloon are .prt's in the assembly, represented with a part number and description. Using the balloon feature, the drop down menu you have highlighted isn't available to me (is it a drop down that can be turned on in the Options menu?). Unless I'm not understanding what a virtual part is, I assume it's just an .prt within the .asm (literally, a 1"x1" extruded cube, hidden after added to the assembly).
I've also read that clicking the part's origin in the tree while on the balloon feature will add the correct item number to the balloon, but that appears to only work with balloon stacks. Besides that, on hidden parts, their origin isn't shown in the tree.
So I played around and discovered what was meant by a virtual part. Rather then being a part imported into the assembly, it's a part that's created within the assembly through the Assembly tab, clicking the drop down at Insert Components and selecting New Part from there. Perfect.
So, now I a different issue. On my drawing, I can balloon a component on my assembly and re-reference it to the virtual part, accessible through the drop down you have shown. BUT, I am not able to use the Non-Visible Components when I have ballooned a sketched line. All the schematics will be drawn in DraftSight and imported into the Solidworks drawing, then ballooned there. When clicking on 2d lines, the balloon text is either a "?" or a "1", I don't know why. And the balloon cannot be re-referenced to the Non-Visible Components.
I have tried some other methods, and eventually got it all to work right. My 2d sketch must be on a view box for the assembly the BOM is linked to. From there, I am able to balloon the 2d lines and re-reference them to the virtual components, thereby giving them the correct item number in the BOM.
Thanks for the point in the right direction!