How to Design Arduino Voltage and Current Sensing Shield
You could use a voltage divider, but it will probably be simpler and safer to use a step down transformer to scale the mains voltage down to something the Arduino ADC can read. 

Make sure that you use an actual bare transformer that outputs an AC waveform and not a switching or rectifying power supply that outputs DC. You can use any transformer that brings the voltage down to a safe level (12 VAC is common for door bells) and then use one voltage divider to scale down to the Arduino's 5 volt peak-to-peak range and another voltage divider to center the  output voltage in the middle of the Arduino's 0-5 Volt range. 

Great info here..

http://openenergymonitor.org/emon/buildingblocks/measuring-voltage-with-an-acac-power-adapter

As for measuring current, the typical strategies include...


Measuring the output of a current transformer like you are doing.
Measuring the voltage across a very low resistance (and high power) shunt resistor. These are typically just a piece of metal with a known resistance. You also often amplify the voltage across the shunt because you you want the smallest resistance (and thus voltage) possible otherwise the shunt will get hot. 
Using a hall effect sensor to detect the magnetic field generated by the current in the wire.


These are all used in practice, although current transformers are probably best for projects like yours because they are simple and do not require actually touching the high voltage wires.