The accountant credited a liability increase of ₹11,000 to Revaluation Account. What is the correct correction?

Correct answer: It should be debited because liability increase is a loss

An increase in a liability means that the firm must bear an additional obligation. It reduces the net worth of the business and is therefore a revaluation loss. Under the rules of Revaluation Account, losses are debited and gains are credited. Consequently, the ₹11,000 liability increase should be debited to Revaluation Account, with the liability account credited to reflect the revised obligation. The accountant’s credit has reversed the normal treatment and would incorrectly show a gain. It should be corrected by transferring or reversing the wrongly credited amount and recording the liability increase on the debit side. The amount remains ₹11,000; no capital account entry is the primary correction. Hence option A is correct.