Cold Corp., a new corporation, took over the assets and liabilities of Trey Cold on January 2, 20X1. The assets and liabilities, after appropriate revaluation by Cold, are as follows (amounts in parentheses are credits; other amounts are debits):

Cash	$ 70,000
Accounts Receivable	215,000
Allowance for Doubtful Accounts	(25,000)
Merchandise Inventory	175,000
Accounts Payable	(25,000)
Accrued Expenses Payable	(10,000)

The corporation is authorized to issue 500,000 shares of $10 par-value common stock and 500,000 shares of $10 par-value preferred stock. The preferred stock bears a stated yearly dividend rate of $1 per share. The transactions that follow were entered into at the time the corporation was formed.

INSTRUCTIONS

1. Make general journal entries to record the transactions.

2. Prepare the opening balance sheet as of January 2, 20X1, for Cold Corp.

3. What is the current ratio for the corporation at January 2, 20X1?