onsolidated Balance sheets: issues of goodwill and differential in the process. Trying to understand some of the processes regarding the goodwill and differential in the consolidated balance sheet process. 1. Explain why consolidated financial statements become increasingly important when the purchase differential is very large. 2. How does an eliminating entry differ from an adjusting entry? (I know this is similar to the intercompany transactions, I think, just not sure how they are related) 3. What is the term differential used to indicate