It's actually a modern innovation, AFAIK. Common people were stripped and wrapped in linens (or equivalent). Obviously, mummy wrapping would be the extreme example of it, but wills often designated who would inherit "my best tunic", because the clothes were quite valuable if still wearable.

I'm speaking of the common people; kings and bishops were buried in finery. And it's not universal by any means. In times of disaster or plague bodies were buried quickly in their current clothes. This leads to some interesting finds, as when all that remains of an entire outfit is the silk stitching and things like metal buttons.

So your friends know you were standing pat when you died.

(See "Saint James Infirmary Blues").

Pearly gates is basically an interview.