If you are a cash basis entity, then this is Income and you are not allowed to hold liability.
Make a prepayment Service item and use it on a Customer Sales Receipt. That service links to income or liability, to meet your accounting need. Stop trying to use JE for customer activities; you use Customer transactions for customer activities.
The Prepayment is not Adjusted as you incur costs. The prepayment is applied to the Invoices for the amounts owed, when you are ready to show you are applying their prepaid funds as value, by putting the prepayment service on a Credit Memo. You charge the customer for income, but you can show you don't expect that all as new money.
If the prepayment is liability, the credit memo clears that liability. If the prepayment was already required to be treated as income, this credit memo treats the sale as a sort of Discounted value with the use of the prepayment item, so that it reduces gross revenue on the actual sale.
And now you get to control for sales tax status, as well.
