The last time I visited Indonesia was more than 20 years ago.

Now, planning to take another trip to Indonesia in the summer and am looking for tour which starts in Jakarta and ends in Bali (visiting Borobudur, and other places in east Java along the way). Would also like to spend a few days in Danau Toba in Sumatera.

Can any FTer here give me some recommendations and advice?

Thanks in advance.

You may not need a standard tour for this sort of on-the-beaten-track itinerary. I just returned from a couple of weeks in Indonesia on my own, with a loose itinerary, a few advance hotel reservations done by internet, and a bunch of making-arrangements-on-the-fly. My itinerary was:
Fly KUL-Jogyakarta. 4 nights in area, including 1 at Borobudur. Taxi from airport to town. Then used becak in Jogya and public bus (cheap and easy) from Jogya to Borob and back, also to Prambanan and back.
Train Jogya-Surabaya, ticket bought myself at the Jogya station a day in advance. Original plan to go by minibus to Mt. Bromo area of East Java had to be scrapped due to advice about rainy weather obscuring the views and making the trip worthless. (This wouldn't be a problem in summer though.) 2 nights Surabaya, local taxi for sightseeing. Tip: hit the House of Sampoerna museum and their free 1-2 hour tour bus around old Surabaya landmarks.
Flgiht Surabaya-Makassar on Sulawesi, had hotel in SUB get it for me a day in advance. 1 night Makassar (dump of a city), purchased outbound Makassar-Jakarta domestic ticket, and then luxury daybus to Tana Toraja area (reserved seat day before).
3 nights Rantepao (Tana Toraja), hotels found on the spot due to low season, but make advance arrangements for high season. Local becaks for short jaunts, also engaged a local guide with car and driver there for 2 days' services around the TT area. Luxury night bus directly back to Makassar airport (ticket purchased 2 days before) then morning flight to Jakarta. 2 nights Jakarta, then flight back to KUL (intl flights prearranged well in advance).

You could do similar, suggest you try routing itinerary to fly internationally into Bali directly. Then go overland (make arrangements once in Bali) via road and the short ferry hop to Java, do East Java/Mount Bromo. This is a very common trip taken by loads of travellers. Then overland (make arrangements there, it's also a common routing) to Jogya. Or if you despise long (11 hour) road trips, get from Mt. Bromo to Surabaya and then train or fly to Jogya and Borobudur. Then fly via Jakarta to Medan in Sumatra and make arrangements to get to Lake Toba from there. Or stay in Jakarta a day and make arrangements there to be met in Medan and taken to Lake Toba by a driver. Depending on where you are headed next, you can exit Indonesia from Medan (to PEN, KUL, SIN and onward) or back to elsewhere via Jakarta. Or in reverse--starting in Medan/Lake Toba and routing via Jakarta to rest of Java, then to Bali, exit intl via Bali.

You'll likely find getting from East Java or Yogya to Sumatra will require at least a transit in Jakarta airport. Suggest minimizing time in Jakarta unless you have business there--not much to see for the casual traveller. Really, this is an easy trip to self-set up. Just make some hotel arrangements in advance and deal with the domestic travel items once there. Try to minimize backtracking and minimize # of times going through Jakarta. International flights in/out best arranged in advance, and I found "open jaws" into Jogya and out Jakarta no more expensive than a straight round-trip, and loads more convenient. To me, it seemed much easier getting around with a good guidebook and a tiny bit of advance reading for historical/cultural stuff. And engaging a local guide at appropriate places (i.e. Tana Toraja). In Indonesia, ALWAYS use a local guide for local areas, never a non-local Indonesian.

My largest expense was for hotel (I am a mid-range type of person), but this is a matter of style and preference. Everything else, including Indonesian inter-city and local transport (and guide when needed), was much cheaper. I estimate my total cost was about 1/2 of what the same items would have cost, done as a packaged or pre-arranged tour. And I found very little time was "wasted" in whatever logistic/onward transportation items I needed to find and purchase as I went along.

Great info JieJie. How did you connect with the local guides? Was it through the hotels?
Could you recommend hotels in Jakarta, Jogya , Surabaya, Medan, and Bali which we could hook up with local guides? Thanks again for your helps.

Guides: I use guides very selectively, and rarely find them via hotels, more often thru other commercial enterprise, and often they find me and I size them up on the spot. Unless I have a first-hand recommendation from somebody I trust, I always limit an "unknown" guide to at most one-half or one day, to see if I like or not, and to give myself an exit position. If I like them and need services for another day, I hire them again. Don't underestimate your own abilities, or overestimate what guides can do for you. For specific places you've mentioned:

Jakarta--no guide needed. There are two main places of tourist interest in the central city: the Merdeka Square/National Museum/Mosque area and the old Dutch Kota area. A taxi or the local bus can get you to these places, and reading a guidebook and a map will do you fine.
Surabaya--ditto. I thought the House of Sampoerna Museum and free bus tour was great, and also visited the Zoo. I think you'd only need a driver/guide if you wanted to go further afield to Madura Island or similar.
Jogya--ditto. Most things of tourist interest excluding Borobudur and Prambanan are in a small area of the central city, partly walkable and partly by becak is best. Some places, like the Kraton (Sultan's Palace), have the option of guides for that location--which I took a pass on in favor of reading my guidebook. At Borobudur and Prambanan you can hire site-specific guides at the entry/ticket area--but I'm well versed in SE Asian architecture and monuments, and with a good guidebook, I didn't feel the need...
Medan I don't know but it has the reputation of being a dump of a city with nothing to see, but a necessary transit evil for those heading to Danau Toba or Gunung Leuser areas. Guides for those areas are best picked up once you get to those areas (so I've heard), but I'm sure you could have private travel + guide arranged in Medan.

Bali: (from a past trip about 3 years ago). A guide, or driver that speaks enough English, is pretty much needed here, as much of interest is widely scattered around the island. I stayed in two places: Ubud, where drivers mill about the main streets daily, looking for business--we just negotiated a day rate with somebody we had positive vibes about, and told him the itinerary we wanted for the day. What was great about this guy was not the standard "sites" spiel--which the driver didn't really have--but the great color commentary he provided about life in Bali, current affairs/issues of the island, etc. There are also plenty of small agencies you can walk in and make arrangements for whatever you want. We did a day of rafting/nature stuff and booked with an agency in Ubud for that. The second place I stayed was an isolated area in the far north of Bali, and for that we arranged with the guesthouse for driver and guide, for a very long day trip that covered much of the eastern half of the island. And also for a separate 1/2 day trip to Singharaja area. Some important places of interest have "official" guides you can hire on (or get strong-armed into it--Pura Besakih was fairly aggressive about this but other places were not).

Hotels: on the Feb 2010 trip, my budget was in the US$40-50 range per night, as I needed simplicity, privacy, cleanliness and a/c but not lots of business or luxury amenities. I didn't want to do the rock bottom backpacker thing on this trip. I also like staying in central locations for transportation purposes (don't like isolation when travelling alone). I found myself staying in a lot of Accor hotels, which isn't typical for me but worked well this time. Before travelling, I prearranged the following, and ended up happy with my choices for this price range (remember Feb is low season in Indo, prices may be somewhat higher at other times):
Jogya + Borobudur: 1 night Phoenix Hotel (colonial, historic, nice), 1 night Manohara Hotel at Borobudur (staying here, you get reduced admission for the sunrise tour 175,000 Rph instead of 350,000 Rph, and free admission at all other times of day as much as you want), 2 nights Ibis Malioboro Hotel (clean and great location).
Jakarta: 2 nights Ibis Arcadia Hotel (also clean and fabulous location).
Surabaya: didn't prearrange, just got off the train and had a taxi take me to the Mercure Hotel, gambling they had room and a decent walk-inrate (they did), 2 nights.

Bali: (previous year's trip, and more expensive about $100 per night for February, but that trip had a different purpose and budget ) Ubud: Kajane Mua on Monkey Forest Road. Sambireteng (far north-northeast coast): Villas Agung Bali Nirwana. For a place like Bali, I'm not a fan of the international chain hotels or their locations like Nusa Dua and Jimbaran--prefer guesthouses and villas--and not a fan of the raucous party crowd at Kuta. Bali has something for everybody though, and it's horses for courses as to preferred location and accommodation.

Thanks a million JieJie for the great info and advice.
With your info, who needs a guidebook
Again, thanks.