Hi Wendy. Thanks for your question.
That option at wp-admin > Events > Settings > General has this help text:
Have an event that runs past midnight? Select a time after that event’s end to avoid showing the event on the next day’s calendar.
So it’s for events that run past midnight.
You might be able to add some custom coding to limit the inputs to nothing later than 5pm or something like that, but we don’t provide support / code snippets for such customizations.
If you’d like, you may search through our feature requests (and add your own if you don’t find an existing one) at https://tribe.uservoice.com/
I hope this information helps. Please let me know if there’s anything else I can help with on this topic.