This always nags me... I would prefer a logical as well as a grammatical explanation of it.
We enjoyed each other's company. We enjoyed each others' company.
Which one is correct? Why is the other not?
Let's take first the sentence
This could be paraphrased as
On the other hand, the sentence
uses the plural form of 'other'. But a paraphrase like
P.S. The question has already been answered at SE English Language and Usage: Should “each” be followed by a singular or plural possessive?