Liko, Roy, and Dot have arrived in the town of Cortondo, where Liko is due to take on the local Gym Leader in her first-ever Terastal battle. While Roy and Dot admire the town and the many Bug Pokémon that reside there, Liko can't help but feel nervous about what's to come. Roy and Fuecoco's noses lead them to the highly popular Patisserie Soapberry, where they decide to try out some of the local sweets. Both them and their Pokémon find them extremely tasty, with Terapagos even asking for seconds. Once they're done eating, they are surprised to see none other than Murdock approaching them, revealing that he's working part-time at Patisserie Soapberry to gain some money for them while Orla focuses on repairing the Brave Olivine. Just as he's about to mention who he's working for, he's interrupted by an angry shout from in front of the pâtisserie. The person responsible for the noise turns out to be Coral, who is outraged for not getting to have any of the town's famous sweets due to them having run out of stock for the day and demands to have some regardless. Murdock addresses the woman Coral is arguing with as Katy, making Liko and her friends realize they are looking at the town's Gym Leader and the person whom Liko is supposed to battle. Katy recognizes Liko by name as well, but before they can as much as agree on having their battle, Coral butts in and demands a battle as well. However, since Katy is busy for the rest of the day, she says she can only face one of them. As such, Coral demands to battle Liko first to see which of them gets to face Katy. Liko accepts and asks Katy if she'd be allowed to use Terastallization in this battle, wanting to practice it before the test. Katy states that students taking the Tera Training course are not allowed to use it against each other and suggests a different type of confrontation instead: a cake-baking contest.
While nervous about having to bake a cake, which she has never done before, Liko still takes on the task with confidence. Thanks to Murdock having previously shown her how to make a cake, she and Floragato produce a successful matcha cake. Coral, meanwhile, only succeeds in producing a messy pile of dough, having no idea how baking is supposed to be done. Crying out in anger, she decides to vent her frustration on the others and has Glalie freeze the entire room with Blizzard. However, as Coral starts talking down to Liko, Katy proceeds to glare at her and tell her to leave in a tone intimidating enough to unnerve even her. Coral reluctantly storms out and recalls Glalie when it can't fit through the door. With Coral out of the competition, Katy declares Liko the winner of the baking contest and agrees to battle her, but tells her and Floragato to try out their cake first. They do so, with Liko being surprised at how good it turned out. Katy points out how she was able to make a successful cake without practicing first by simply putting her heart into it, which can apply for battles as well. Liko realizes that she was overthinking earlier when she wanted to practice, understanding now that every battle is a real battle and resolving to try out Terastallization during her test.
Liko and Katy move on to Cortondo Gym's outdoor battlefield, with Roy, Dot, and Murdock watching and cheering from the sidelines. Dot is worried that Liko's Floragato will be at a disadvantage against Katy's Bug Pokémon, but surprisingly, Katy decides to her Teddiursa, a Normal type, instead. Katy starts the battle, with Floragato making the first move with Quick Attack. Katy tells Teddiursa to use Charm, which causes Floragato to become flustered by her opponent's sudden display of cuteness and only gently tap it. This leaves the Grass Cat Pokémon open for a Slash from Teddiursa. Liko tells Floragato to step back and attack from a distance with Magical Leaf. Before she can do so, she is caught in Teddiursa's Sweet Scent, causing Floragato to lose her focus and allowing Teddiursa to hit her with another Slash. With both close-range and distance attacks proving troublesome and Floragato getting struck by Slash again and again, Liko's friends are worried if she'll survive long enough to even Terastallize her Pokémon. Liko is getting nervous as well, until she remembers the words Katy had said to her before the battle and resolves to enjoy the battle alongside her partner. When Teddiursa uses Sweet Scent again, Liko tells Floragato to aim her Magical Leaf down, bouncing it off the battlefield and forming a wall of leaves that blocks the scent. Teddiursa's attempt at using Slash instead is deflected by a similar maneuver. Seizing her chance, Liko pulls out her Tera Orb and Terastallizes Floragato into a Grass Tera Type. A powered-up Magical Leaf blows Teddiursa back, but while Liko and Floragato are celebrating their first Terastallization, Katy decides to even the playing field and uses her own Tera Orb as well, turning Teddiursa into a Bug type. As a result, Floragato's following Magical Leaf fails to deal notable damage, allowing Teddiursa to get close once more and unleash a powered-up and super effective Fury Cutter, defeating Floragato.
Rushing over to her defeated partner, Liko apologizes to her for losing after they tried so hard. Katy, however, surprises Liko by declaring that she has passed her test, revealing that during the Tera Training course, it doesn't matter if the student wins or loses their battle. Since Liko demonstrated being in perfect sync with her partner and chose the perfect timing for her Terastallization, Katy rewards her with a stamp on her Rotom Phone. She even admits that she could've ended the battle the moment Liko used Terastallization, but couldn't help herself from doing the same. Liko thanks Katy and promises to try harder from here on out, while Katy reminds her to always enjoy the here and now and invites everyone for some sweets. That night, after having enjoyed their fill of sweets, Liko, Roy, and Dot are camping outside of Cortondo, with all three of them feeling too excited by the battle to actually sleep. While Liko thanks her partner, Roy is getting fired up by his upcoming rematch against Brassius at their next destination, Artazon.
