VEX Robotics Optical Shaft Encoder help

How do I connect the VEX Robotics Optical Shaft Encoder to the Arduino Uno and create code that reads this sensor and display the values on the Serial Monitor? The encoder wheel has 90 slots and there are two output channels. I think that the outputs are 90 degrees out of phase. The encoder unit has IR LEDs and IR sensors.

http://www.vexrobotics.com/products/accessories/sensors/276-2156.html

This is a standard quadrature rotary encoder. You find lots of examples in the playground article:

http://arduino.cc/playground/Main/RotaryEncoders

Pylon, Thanks for helping me get the encoder working.

jeffmorris:
... I think that the outputs are 90 degrees out of phase...

Maybe you already figured out but they are out of phase to allow you to determine the direction of rotation...