"That is a place where we can remember the people who died. Each person has a marker with the birth date and the day they died. Your Great Grandma has a place with her name on it because she was buried there. The cool thing is that even though Grandma Peters does not live any more here with us, she is in heaven with Jesus having fun praising Him. Grandma Peters loved Jesus very much."
At that point I was quite pleased with my answer when Emma came back with responses like, "Is heaven a long ways away?" and "I glad Grandma Peters love Jesus." We talked about it for quite some time. It was a lovely parenting moment. A few days later we drove passed the same cemetery and Emma obviously remembered our conversation and summarized the details:
"My great Grandma Pretties was really, really old and lives in the dirt at that place. But sometimes she goes to heaven with Jesus."
I have more work to do.