Help Galaxy Ace 2 has much less memory than it should?

[Steve Gantlett]

I believe my new Galaxy Ace 2 (i8160) is supposed to have 4GB of device memory, but when I go to look at it it says it has a total of only 1.2GB, while it also says it has another 1.1GB of 'USB Storage'. What is this 'USB Storage'? Assuming it is another form of internal phone storage, 1.2 + 1.1 still makes only 2.3 – nowhere near 4GB. Am I missing something please? (I am running a 32GB SD card too, but not everything can be put on the SD card of course).