The correct answer is A. Interest A/c.
A nominal account is a temporary account that is used to record revenues and expenses for a specific period of time. These accounts are closed at the end of the accounting period and the balances are transferred to the retained earnings account.
Interest A/c is a nominal account that is used to record interest income and interest expense. Interest income is recorded when a company receives interest on loans or investments. Interest expense is recorded when a company pays interest on loans.
Accrued Interest A/c is a real account that is used to record interest that has been earned but not yet received. Outstanding Interest A/c is a real account that is used to record interest that has been incurred but not yet paid. Prepaid Interest A/c is a real account that is used to record interest that has been paid in advance.
In summary, the correct answer is A. Interest A/c because it is a nominal account that is used to record interest income and interest expense.