Memory management in photoshop

It's normal. What you see reported is the memory available for Photoshop, which is less than the total amount. I have 32 GB on this machine, and Photoshop reports 25.

The calculation changed a few versions ago, so now it reports slightly less than it used to.  But still, it's as designed and there's nothing wrong.

It doesn't matter much in practice. Contrary to what many believe, there is no such thing as "enough RAM" anyway. The heavy lifting is done by the scratch disk. The real memory needs are much bigger than any RAM you may have, so temporary working data are written to disk. That's the scratch disk. Think of RAM as a fast access cache to the scratch disk's main memory.

In the old days, disk drives were slow, so then it mattered. Today's crazy fast NVMe drives removes that bottleneck for all practical purposes. The critical thing is to make sure you have enough scratch disk space (at least 150-250 GB for any serious work, but sometimes even more is needed).

Assigning the max possible amount of RAM to Photoshop is not really desirable in any case. The rest of the system needs memory too, or everything starts to slow down. Even Photoshop plugins like ACR need their own memory. So keep it at around 70%.