Oh, I remember that one, too. Children are tape recorders on legs, and remember more of what their parents say, than they may think.
I also remember a time, when our daughter was a little older, when she was talking on the phone to a friend, and said that so-and-so was an "--------". My husband heard her and sternly told her NOT to use that word ever again. She countered with "Well, YOU use it sometimes!" I said, rather dryly, with my arms crossed, "Yes dear, she is right--you DO." He sheepishly hung his head and said "You are right, I do, and I shouldn't, so neither of us should use that word."