A billing system for determining package transportation charges. The billing system includes a reader to read a package identifier associated with said package and the reader generates a package identifier signal and transmits the same to a microprocessor. The billing system also includes a package sizer having a plurality of non-contact optical sensors located along each of an x, y and z axis, where each optical sensor is in a known position. The sensors are oriented relative to the conveyor so that packages passing over the sensors are detected by the sensors and produce a signal correlated to said package size. Also provided is a microprocessor to receive and correlate said package size and identifier signals, and to determine an appropriate shipping charge based upon the same. A weigh scale may also be incorporated into the system. A method of determining a transportation charge is also comprehended, which includes a self-diagnostic initialization procedure.