How do I curb my kids bad mouths?

My husband has a cold sore on his lip that got infected and then scraped and dug into by the dog. It doesn't look good. To make matters worse my kids have been calling it his 'rape-stache', insinuating he was attacked in self-defense by a victim he was attempting to rape (or so I assume). This isn't the first time my kids have spoken like this. They have no manners and constantly use foul language. They say disgusting things all the time. One of my sons called it 'butt make-up' when his baby sister smeared you-know-what across her face. It makes me sick to think that my children don't understand how unbecoming it is to say such things. I absolutely cannot reason with them not to. I am hoping once they hit their teens they can rationalize better. They'll learn fast when dating boys that speaking like that will not get them wanted attention. I do not want to abuse or beat them. I do not like the idea of spankings or batterings. What good incentives are there?