Standard residual is defined as the residual divided by the standard deviation of the residuals.
It can be calculated as follows:
If we have n residuals r1, r2,…,rN, then find the mean
Calculate the standard deviation of the series
For every residual, the standardized residual is given as
sr(i) = (ri-mean)/standard-deviation
This is a method of transforming the data so that its mean is zero and the standard deviation is one. Generally only 5% of the residuals could fall outside -2 and +2
If many of the residuals fall outside the given range, then the distribution is not considered to be normal. It is considered to be normal when more than 95% of the residuals fall in the range of -2 and +2.