FULL PRODUCT VERSION :
java version "1.7.0_25"
Java(TM) SE Runtime Environment (build 1.7.0_25-b17)
Java HotSpot(TM) 64-Bit Server VM (build 23.25-b01, mixed mode)

ADDITIONAL OS VERSION INFORMATION :
Microsoft Windows [Version 6.1.7601]

A DESCRIPTION OF THE PROBLEM :
Class below compiles but runs with VerifyError exception

public class Test {
    public static interface C<T> {
        T compute();
    }

    public static <T> T test(C<T> c) {
        return c.compute();
    }

    public static class Wrapper<T> {
        public T value;
    }

    public static <T> T of(T t) {
        return t;
    }
    public static void main(String... args) {
        final Wrapper<String> w = new Wrapper<String>();
        test(new C<String>() {
            public String compute() {
                return w.value = of("test");
            }
        });
    }
}



Exception in thread "main" java.lang.VerifyError: Bad return type in method Test$1.compute()Ljava/lang/String; at offset 13
at Test.main(Test.java:20)
at sun.reflect.NativeMethodAccessorImpl.invoke0(Native Method)
at sun.reflect.NativeMethodAccessorImpl.invoke(NativeMethodAccessorImpl.java:57)
at sun.reflect.DelegatingMethodAccessorImpl.invoke(DelegatingMethodAccessorImpl.java:43)
at java.lang.reflect.Method.invoke(Method.java:606)
at com.intellij.rt.execution.application.AppMain.main(AppMain.java:120)



ERROR MESSAGES/STACK TRACES THAT OCCUR :
Exception in thread "main" java.lang.VerifyError: Bad return type in method Test$1.compute()Ljava/lang/String; at offset 13
at Test.main(Test.java:20)
at sun.reflect.NativeMethodAccessorImpl.invoke0(Native Method)
at sun.reflect.NativeMethodAccessorImpl.invoke(NativeMethodAccessorImpl.java:57)
at sun.reflect.DelegatingMethodAccessorImpl.invoke(DelegatingMethodAccessorImpl.java:43)
at java.lang.reflect.Method.invoke(Method.java:606)
at com.intellij.rt.execution.application.AppMain.main(AppMain.java:120)


REPRODUCIBILITY :
This bug can be reproduced always.

---------- BEGIN SOURCE ----------
public class Test {
    public static interface C<T> {
        T compute();
    }

    public static <T> T test(C<T> c) {
        return c.compute();
    }

    public static class Wrapper<T> {
        public T value;
    }

    public static <T> T of(T t) {
        return t;
    }
    public static void main(String... args) {
        final Wrapper<String> w = new Wrapper<String>();
        test(new C<String>() {
            public String compute() {
                return w.value = of("test");
            }
        });
    }
}

---------- END SOURCE ----------

CUSTOMER SUBMITTED WORKAROUND :
Split
 return w.value = of("test");
into 2 statement:
 w.value = of("test");
 return w.value;