I'm sorry to hear of your friend's passing.  Personally, I would tell my child.  If you follow a particular religion, your beliefs will guide your words.  Sad as it will be, your child should know that her friend did not choose to leave her.  Since she sounds like a caring little girl, she may also want the opportunity to say goodbye.

I wouldn't overthink the situation.  Little ones can handle quite a bit.  I would just tell her that she passed away and went to heaven with God.  My parents never hid death from us or made it seem unnatural.  No matter how young we were, we attended all wakes and funerals with my parents.  It never weirded us out or made us feel uncomfortable.  To hide death from a child will make them fear it.  You just have to present it as a normal part of life.

I agree with everyone else, and definitely tell her earlier rather than later.  My dad recently passed away unexpectedly (and his sister passed just two months before that, expectedly).  I have one neice who is 6, and then two children of my cousins' who are 7 (the granchildren of his sister).  They all fully comprehended it.  And having gone through two funerals in a short time, have had their sad times, but are remarkably resilient.

Maybe since she liked to draw pictures for this friend, she could make a card and donate a dollar to a designated memorial fund for the cashier?  Perhaps the store where she worked would know of the appropriate fund and maybe your daughter could even drop off the card there, if you don't know the appropriate mailing address for the family? 

Sorry for her loss :(  let us know how she is doing once you tell her.