A retort meaning that something is really going to happen. Statement of agreement meaning that something for sure must happen. The fact that it doesn't really rhyme makes it funnier if used as a retort when talking to somebody who won't really get it and will actually think you used it cause it rhymes. However, now used in common language with reasonably intelligent people because the obscurity of it and lack of true rhyme makes it sound like something a truly stupid person would say.
Friend 1 (slightly less intelligent friend): I really feel like going out tonight, I gotta get my drink on.
Friend 2: Yeah brother, I'm with you on that. It's on.
Friend 3: Oh it's on, like Rae Dawn Chong.