New Password not Being Accepted

Do I place the "init..." immediately after "rootwait" as placing it at the end of the present line (as shown below) results in "job control turned off"?

As far as I'm aware the order of the parameters doesn't matter, although there could be exceptions to that. What is important is that the file be all one line.

The "job control turned off" isn't because of that, it's because something is wrong with the system -- eg., the kernel can't properly access the root filesystem to load some needed module, although it clearly can in some sense since this the message is actually from /bin/sh, the shell. You can read up on job control if you like; not having it is not a huge problem if all you have to do is set a password, but what it is symptomatic of may be a huge problem: If there is not proper read-write access to the root filesystem, setting a new password will fail one way or another.

At the prompt, try: mount | grep mmcblk0p7. You should get this:

/dev/mmcblk0p7 on / type ext4 (rw,noatime)

The important part is the rw (read-write) in parentheses. If you don't have that, the problem may be SD card corruption that could not be fixed by fsck (which is enabled in your cmdline.txt).