He reacted very well. As I see it he had to make a snap decision between two courses of actions. Either laugh it off, or devour every child in the room. With his high bball IQ it was easy for him to make the right snap decision.
In all seriousness. I've been teaching English in Japan for more than two years now. One day I got called out by a 10 year old Japanese student when I forgot how to spell hamburger. This was the same student that only 10 minutes before spelled dog with a "b".