Answer: The correct words that complete the sentence are “is” and “its”: The colony of ants is making its way up and over the grassy mound.
Explanation: In the sentence provided, “colony”, which is a singular noun, is the head of the subject. Moreover, the noun “colony” indicates that a group (of ants, in this case) is working together as a unit. Taking this into consideration, a singular verb has to be used in order to make the subject and the verb agree in number. In that way, “is” is the word that completes the sentence. Furthermore, as “colony” is a singular noun, a singular pronoun needs to be used; therefore, the pronoun that completes the sentence and comes before “way” is “its”.