Final answer:
Analyzing financial ratios provides valuable insights for a business owner but cannot reveal the complete story of a business necessary for determining future performance due to its quantitative nature.
Step-by-step explanation:
Analyzing financial ratios can do many things for a business owner, but it cannot show the whole story behind the business to determine future company performance. Financial ratios are important tools for assessing a business's financial health. They can help identify areas such as overextending credit, excessive debt levels, or high inventory which may need addressing.
However, while these ratios provide valuable snapshots of specific aspects of a company's financial situation, they do not capture all the qualitative factors and potential future changes in markets or operations that ultimately influence long-term performance. Ratios are just one part of a comprehensive financial analysis and should be used in conjunction with other information.