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This is where my question comes in for the M4 as well as a sniper rifle that I am building.
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You are building a sniper rifle while you are still struggling with basic ballistics? My, you are an ambitious fellow. I'm sure you'll get it all down soon.
The base reason is gravity. The bullet starts dropping as soon as it leaves the muzzle. And its moving "sideways" pretty fast,as it falls.
To compensate for this (as much as we can) gun barrels are "pointed up", compared to the line of sight, which is straight at the target. Although they look parallel to the eye, the line of the bore and the line of sight are not. So the bullet is fired "up", and crosses the line of sight going up a short distance from the muzzle.
Then as it flies downrange, falling, it crosses the line of sight again, on its way down. The distance from the muzzle where this happens is where your sights and bore are "zeroed". Adjusting the sights allow us to decide at what range that second crossing happens, 100, 200, 300yds, etc.
Velocity and bullet construction determine the arc of the trajectory. For the M16A1 using the GI ball ammo of the 1970s (which I have personal experince with), hitting a certain spot on the 25 meter target meant that you would hit the desired spot at 250 meters.
This principle will work for all rounds, and to zero at any chosen distance, all that needs to be done is calculate the right spot on the 25 meter target. It will be different for different guns and loads.