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Stenden AIR -

Annual Report – Tourism Economics

International Tourism Management - Brouwer

Piet

16-06-2022

Written by
Patrick Reichert, 5027519
Britte Olsder, 5028744
Stacy Vargas Ortiz,4809319
Camilla Girardi,5051983
Caroline Heese, 5079225
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Table of Contents
Introduction...........................................................................................................................................3

Goal....................................................................................................................................................3

Stenden Air - General corporate and operational information..............................................................4

Financial Events......................................................................................................................................6

Balance Sheet 1st of January 2021.....................................................................................................6

Financial Transactions 2021...............................................................................................................6

Journal Entries 2021...........................................................................................................................7

Used Ledger Accounts:...................................................................................................................7

Used Specialised Equity Accounts:.................................................................................................7

Fixed and Variable Costs 2021............................................................................................................8

Break Even Point................................................................................................................................8

Financial Statements............................................................................................................................10

Balance Sheet 1st January 2021.......................................................................................................10

Balance Sheet 31st December 2021.................................................................................................10

Financial Statement 2021.................................................................................................................15

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Introduction
The project focuses on writing an annual report of a virtual scenario of a tourism company. The
annual report assignment is a group and partly individual assignment. The aim of the group part is to
present the annual report of the company including several financial events which took place in
2021. The report starts by presenting the used company, Stenden Air, by explaining the general
corporate information and economic outline of our company. Next to this, the report includes the
company’s financial events and financial statements of the year 2021. This includes the visualisation
of the financial transactions, the journal entries of 2021, as well as the presentation of the fixed and
variable costs and the Break Even Point calculation. Moreover, the financial statements are
presenting the balance sheets of the 1 st of January 2021 as well as the new balance sheet of the 31 st
of December 2021, followed by the financial statement.
As an addition to the annual report, the aim of the individual assignment is to write the final
part of the annual report of Stenden Air. Each group member writes the explanation of the report
linked to serval economic topics and will make relevant calculations together with the analysis.  

Goal
  The first nine weeks of the semester were dedicated on studying different topics related to
Bookkeeping and Management Accounting. The goal of the report is to apply the knowledge gained
during the past weeks and applied it in a virtual scenario of the company, a tourism company. The
‘Annual report’ assignment is a group and partly individual assignment, the group part and the
individual part will be handed in separately. The goal of this assignment is to create an annual report
based on a virtual company containing all information, including economic figures, explanation, and
interpretation of the virtual company.  
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Stenden Air - General corporate and operational information

Stenden Air is a small private airline tour operator in Australia. The tour operator offers
sightseeing tours of three hours over the Kalbarri National Park in Western Australia. Since the
Kalbarri National Park is one of the main tourist attractions in Western Australia, the company is, due
to its location quite successful.
The headquarter of Stenden Air is located in Yallabatharra in the south of the National Park.
Stenden Air is a privately owned company which operates as a limited liability company (LCC). The
company consists of one owner, Lewis Pratt, his personal assistant, five pilots and two maintenance
workers.

Figure 1
Organisational Structure – Stenden Air

Lewis Pratt
Owner

Personal Assistant

Pilots Maintenance

Stenden Air operates with four planes, Piper PA-32 Cherokee Six, with five passenger seats
each. Each plane is conducting two round trips per day. The offered round flights attract many
tourists with a higher income, because the price for one roundtrip is 395,00€. However, the
customers are also consisting of travellers who are willing to spend more money for a once in a
lifetime experience.
The company has 320 flight days per year. The Australian summer season, between November
and March (Q1 & Q4) is the busiest season with around 1600 seats sold. In total Stenden Air has
5 964 customers during the year which are spread over the quarters. Figure 2 represents the round-
trip seats sold per quarter.
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Figure 2
Round-trip seats sold per quarter.
QUARTER (80 FLIGHT DAYS) ROUNDTRIP SEAT SOLD
I 1 600
II 1 444
III 1 420
IV 1 500
TOTAL 5 964

Stenden Air owns buildings of a value of 250 000 €, which includes an office of 100 000 € and a
medium-sized hangar for the storage and maintenance of the planes of 150 000 €. Next to this, the
company own four Piper PA-32 Cherokee Six of a value of 200 000 € each, which leads to a value of
the planes of 800 000 €. Those 800 000 € are part of the equipment of 830 000, which consists apart
of the planes of maintenance tools and machines of 30 000 € for the maintenance and repair of the
planes. Moreover, the company owns inventory of 25 000 €, which includes different inventory for
the office as well as small gifts, foods and drinks for the passengers. Finally, Stenden Air has 25 000 €
cash on their business bank account next to 2 000 € of awaiting payments.
Furthermore, Lewis Pratt did not have the necessary financial resources to buy the necessary
buildings, equipment, planes and inventory to run the company. Therefore, it was necessary to use a
mortgage of 250 000 € with a rate of 5% to finance the office and hangar. Moreover, another bank
loan of 800 000 € and an interest rate of 6% was needed to purchase the four planes.
Additionally, Stenden Air still needed to pay 12 000 € and 5 200 € of VAT at the beginning of
2021, which lead to an equity of 64 800 €.
The interest costs stay the same the whole year because there is only one deposit moment at
the end of each year for the bank loan and the mortgage is interest only for 30 years and currently at
year five. 
The energy costs are accumulated over the year in one invoice, so this does not change. But
the fuel needed for the planes will be paid directly after purchase. 
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Financial Events
Balance Sheet 1st of January 2021
DEBIT STENDEN AIR 1-1-2021 CREDIT

Buildings € 250,000.00 Equity € 64,800.00

Equipment € 830,000.00 5% Mortage € 250,000.00
Inventory € 25,000.00 6% Bank Loan € 800,000.00
Bank € 25,000.00 Accounts Payable € 12,000.00
Accounts Rec. € 2,000.00 VAT Payable € 5,200.00

€ 1,132,000.00 € 1,132,000.00

Financial Transactions 2021

02-02-2021 Purchased in cash: fuel 4 000 €

02-04-2021 Investment in new Equipment 3 500 €

03-05-2021 Purchased in cash: inventories 1 200 €

05-06-2021 Purchased on account: inventories 2 500 €

08-07-2021 Returned to supplier damaged Equipment

Credit invoice received 1 100 €

06-08-2021 Depreciation on Equipment 1 300 €

10-09-2021 Customers cancelled flight

Credit invoice sent 590 €

11-10-2021 Paid Salaries 2021 540 000 €

12-11-2021 Interests on Bank Loan 48 000 €

20-12-2021 Depreciation on Planes 120 000 €

24-12-2021 Sales cash 2021 1 700 000 €

24-12-2021 Sales on account 2021 59 380 €

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Journal Entries 2021

Used Ledger Accounts:
Buildings Equity
Equipment Mortgage
Inventory Bank Loan
Bank Accounts Payable
Accounts Receivable VAT Payable

Used Specialised Equity Accounts:

Planes Interest Expenses
Operating Expenses Depreciation Expenses
Wages and Salaries
Gross Profit

Date Ledger Accounts Debit Credit

2-Feb Inventory € 4,000.00

Bank € 4,000.00
2-Apr Equipment € 3,500.00
Bank € 3,500.00
3-May Inventories € 1,200.00
Bank € 1,200.00
5-Jun Inventories € 2,500.00
Accounts Payable € 2,500.00
8-Jul Accounts Payable € 1,100.00
Equipment € 1,100.00
6-Aug Depreciation € 1,300.00
Equipment € 1,300.00
10-Sep Gross Profit € 590.00
Accounts receivable € 590.00
11-Oct Wages and Salary € 540,000.00
Bank € 540,000.00
12-Nov Interest Expenses € 48,000.00
Bank € 48,000.00
20-Dec Depreciation € 120,000.00
Planes € 120,000.00
24-Dec Bank € 1,700,000.00
Accounts receivable € 59,380.00
Gross Profit € 685,860.00
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Fixed and Variable Costs 2021

CATEGORY DETAILS COST IN 2021
FIXED COSTS Depreciation Planes 120 000 €
Depreciation Equipment 1 300 €
Salary and Wages 540 000 €
Fuel 300 000 €
Interests Costs 48 000 €
Mortgage Costs 12 500 €

TOTAL FIXED COSTS 1 021 800 €

VARIABLE COSTS Operating Expenses 180 € per passenger

TOTAL VARIABLE COSTS 180 € per passenger

Fixed Costs

Depreciation Salary and Wages Fuel

Interests Costs Mortage Costs

Break Even Point

BEP = F / (p – v) = 1 021 800 / (395 – 180) = 4 752,55 = 4 753 passengers

It is necessary to sell 4 753 tickets per year in order to have no losses and that the costs and sales are
equal.
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Break Even Point

6000000

5000000

4000000

3000000

2000000

1000000

0
0 100 200 400 800 1600 3200 6400 12800

Fixed Costs Total Costs Sales Variable Costs

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Financial Statements
Balance Sheet 1st January 2021
DEBIT STENDEN AIR 1-1-2021 CREDIT

Buildings € 250,000.00 Equity € 64,800.00

Equipment € 830,000.00 5% Mortage € 250,000.00
Inventory € 25,000.00 6% Bank Loan € 800,000.00
Bank € 25,000.00 Accounts Payable € 12,000.00
Accounts Rec. € 2,000.00 VAT Payable € 5,200.00

€ 1,132,000.00 € 1,132,000.00

Balance Sheet 31st December 2021

Buildings
Date Description Amount Date Description Amount
1-Jan Balance € 250,000.00 31-Dec Balance € 250,000.00

€ 250,000.00 € 250,000.00

Equipment
Date Description Amount Date Description Amount
1-Jan Balance € 830,000.00 8-Jul € 1,100.00
2-Apr € 3,500.00 6-Aug € 1,300.00
31-Dec Balance € 831,100.00

€ 833,500.00 € 833,500.00
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Inventory
Date Description Amount Date Description Amount
1-Jan Balance € 25,000.00 31-Dec Balance € 32,700.00
2-Feb € 4,000.00
3-May € 1,200.00
5-Jun € 2,500.00

€ 32,700.00 € 32,700.00

Bank
Date Description Amount Date Description Amount
1-Jan Balance € 25,000.00 2-Feb € 4,000.00
24-Dec € 1,700,000.00 2-Apr € 3,500.00
3-May € 1,200.00
11-Oct € 540,000.00
12-Nov € 48,000.00
31-Dec Balance € 1,128,300.00

€ 1,725,000.00 € 1,725,000.00

5% Mortage
Date Description Amount Date Description Amount
31-Dec Balance € 250,000.00 1-Jan Balance € 250,000.00

€ 250,000.00 € 250,000.00

6% Bank Loan
Date Description Amount Date Description Amount
31-Dec Balance € 800,000.00 1-Jan Balance € 800,000.00

€ 800,000.00 € 800,000.00

Accounts Payable
Date Description Amount Date Description Amount
8-Jul € 1,100.00 1-Jan Balance € 12,000.00
31-Dec Balance € 13,400.00 5-Jun € 2,500.00

€ 14,500.00 € 14,500.00
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Accounts Receivable
Date Description Amount Date Description Amount
1-Jan Balance € 2,000.00 10-Sep € 590.00
24-Dec € 59,380.00 31-Dec Balance € 60,790.00

€ 61,380.00 € 61,380.00

VAT Payable
Date Description Amount Date Description Amount
31-Dec Balance € 5,200.00 1-Jan Balance € 5,200.00

€ 5,200.00 € 5,200.00

Planes
Date Description Amount Date Description Amount
31-Dec Incom. Stat. € 120,000.00 20-Dec € 120,000.00

Depreciation Expenses
Date Description Amount Date Description Amount
6-Aug € 1,300.00 31-Dec Incom. Stat. € 121,300.00
20-Dec € 120,000.00

Wages and Salaries

Date Description Amount Date Description Amount
11-Oct € 540,000.00 31-Dec Incom. Stat. € 540,000.00
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Operating Expenses
Date Description Amount Date Description Amount
31-Dec Incom. Stat. € 1,073,520.00 24-Dec € 1,073,520.00

Interests Expenses
Date Description Amount Date Description Amount
12-Nov € 48,000.00 31-Dec Incom. Stat. € 48,000.00

Gross Profit
Date Description Amount Date Description Amount
10-Sep € 590.00 24-Dec € 685,860.00
31-Dec Incom. Stat. € 685,270.00

Income Statement 2021

Debit Credit
31-Dec Wages & Salary € 540,000.00 31-Dec Planes € 120,000.00
31-Dec Depreciation € 121,300.00 31-Dec Gross Profit € 685,270.00
31-Dec Interest Expenses € 48,000.00 31-Dec Operating Expenses € 1,073,520.00
31-Dec Equity € 1,169,490.00

€ 1,878,790.00 € 1,878,790.00
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Equity
Date Description Amount Date Description Amount
31-Dec Balance € 1,232,290.00 1-Jan Balance € 64,800.00
31-Dec Net Profit € 1,169,490.00

€ 1,232,290.00 € 1,234,290.00

DEBIT STENDEN AIR 31-12-2021 CREDIT

Buildings € 250,000.00 Equity € 1,234,290.00

Equipment € 831,100.00 5% Mortage € 250,000.00
Inventory € 32,700.00 6% Bank Loan € 800,000.00
Bank € 1,128,300.00 Accounts Payable € 13,400.00
Accounts Rec. € 60,790.00 VAT Payable € 5,200.00

€ 2,302,890.00 € 2,302,890.00
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Financial Statement 2021

Trial Balance Balances Income Statement Balance Sheet
Ledger Accounts
Debit Credit Debit Credit Debit Credit Debit Credit
Buildings € 250,000.00 € 250,000.00 € 250,000.00
Equipment € 833,500.00 € 2,400.00 € 831,100.00 € 831,100.00
Inventory € 32,700.00 € 32,700.00 € 32,700.00
Bank € 1,725,000.00 € 596,700.00 € 1,128,300.00 € 1,128,300.00
5% Mortage € 250,000.00 € 250,000.00 € 250,000.00
6% Bank Loan € 800,000.00 € 800,000.00 € 800,000.00
Accounts Payable € 1,100.00 € 14,500.00 € 13,400.00 € 13,400.00
Accounts Receivable € 61,380.00 € 590.00 € 60,790.00 € 60,790.00
Planes € 120,000.00 € 120,000.00 € 120,000.00
VAT Payable € 5,200.00 € 5,200.00 € 5,200.00
Depreciation Expenses € 121,300.00 € 121,300.00 € 121,300.00
Interests Expenses € 48,000.00 € 48,000.00 € 48,000.00
Wages and Salary € 540,000.00 € 540,000.00 € 540,000.00
Operating Expenses € 1,073,520.00 € 1,073,520.00 € 1,073,520.00
Gross Pofit € 590.00 € 685,860.00 € 685,270.00 € 685,270.00
Equity € 64,800.00 € 64,800.00 € 1,234,290.00
Net Result € 1,169,490.00
Total € 3,613,570.00 € 3,613,570.00 € 3,012,190.00 € 3,012,190.00 € 1,878,790.00 € 1,878,790.00 € 2,302,890.00 € 2,302,890.00