Punishment is not popular today and this makes it extra hard to explain to modern children. Any punishment at school is very mild and a cross is barbaric. However it's important that we wrestle with it and get the answer from what God has said in the Bible. Here is a response that I hope is helpful. Forgiveness can only occur when sin is dealt with.
Forgiveness comes at a cost.
For God to forgive us sin had to be dealt with in a real way. He had to deal with it if he was to forgive us for our rebellion against him. The Bible makes it clear that the only way God could do this was for Jesus to die in our place and take the punishment we deserved. This was the price that God the Father and Jesus were willing to pay. It was the cost for forgiveness to be possible.