No, not typical/correct behaviour at all.
Sounds like a memory problem related to the U8 5101 - either that chip is not receiving voltage to retain settings or a fault with the chip (most likely the former) Check their is voltage present at the input to the U8 5101 chip when machine is off.
The 40 credits at start up is typical of a memory loss issue too. If the back-up memory is working properly it will boot up to whatever the remaining credits were (& retain other selected input settings too) when the game was switched off. I'm not aware of any mod/setting that sets the game at a 40 credit default on boot up? could be though.
I have seen a set up where a second switch (which is wired to a coin up switch) has been piggy backed to the start switch. So when the start switch is pressed it adds a credit at the same time effectively leaving the credits always at the same number (whatever it is to start with)