update CFG to properly handle do statements

src/compiler/binder.ts

@@ -892,8 +892,13 @@ namespace ts {
 
         function bindDoStatement(node: DoStatement): void {
             const preDoLabel = createLoopLabel();
-            const preConditionLabel = createBranchLabel();
-            const postDoLabel = createBranchLabel();
+            const enclosingLabeledStatement = node.parent.kind === SyntaxKind.LabeledStatement
+                ? lastOrUndefined(activeLabels)
+                : undefined;
+            // if do statement is wrapped in labeled statement then target labels for break/continue with or without 
+            // label should be the same 
+            const preConditionLabel = enclosingLabeledStatement ? enclosingLabeledStatement.continueTarget : createBranchLabel();
+            const postDoLabel = enclosingLabeledStatement ? enclosingLabeledStatement.breakTarget : createBranchLabel();
             addAntecedent(preDoLabel, currentFlow);
             currentFlow = preDoLabel;
             bindIterativeStatement(node.statement, postDoLabel, preConditionLabel);
@@ -1111,8 +1116,11 @@ namespace ts {
             if (!activeLabel.referenced && !options.allowUnusedLabels) {
                 file.bindDiagnostics.push(createDiagnosticForNode(node.label, Diagnostics.Unused_label));
             }
-            addAntecedent(postStatementLabel, currentFlow);
-            currentFlow = finishFlowLabel(postStatementLabel);
+            if (!node.statement || node.statement.kind !== SyntaxKind.DoStatement) {
+                // do statement sets current flow inside bindDoStatement
+                addAntecedent(postStatementLabel, currentFlow);
+                currentFlow = finishFlowLabel(postStatementLabel);
+            }
         }
 
         function bindDestructuringTargetFlow(node: Expression) {

tests/baselines/reference/doWhileUnreachableCode.js

@@ -0,0 +1,26 @@
+//// [doWhileUnreachableCode.ts]
+function test() {
+    let foo = 0;
+    testLoop: do {
+        foo++;
+        continue testLoop;
+    } while (function() {
+        var x = 1;
+        return false;
+    }());
+
+    return foo;
+}
+
+//// [doWhileUnreachableCode.js]
+function test() {
+    var foo = 0;
+    testLoop: do {
+        foo++;
+        continue testLoop;
+    } while (function () {
+        var x = 1;
+        return false;
+    }());
+    return foo;
+}

tests/baselines/reference/doWhileUnreachableCode.symbols

@@ -0,0 +1,22 @@
+=== tests/cases/compiler/doWhileUnreachableCode.ts ===
+function test() {
+>test : Symbol(test, Decl(doWhileUnreachableCode.ts, 0, 0))
+
+    let foo = 0;
+>foo : Symbol(foo, Decl(doWhileUnreachableCode.ts, 1, 7))
+
+    testLoop: do {
+        foo++;
+>foo : Symbol(foo, Decl(doWhileUnreachableCode.ts, 1, 7))
+
+        continue testLoop;
+    } while (function() {
+        var x = 1;
+>x : Symbol(x, Decl(doWhileUnreachableCode.ts, 6, 11))
+
+        return false;
+    }());
+
+    return foo;
+>foo : Symbol(foo, Decl(doWhileUnreachableCode.ts, 1, 7))
+}

tests/baselines/reference/doWhileUnreachableCode.types

@@ -0,0 +1,34 @@
+=== tests/cases/compiler/doWhileUnreachableCode.ts ===
+function test() {
+>test : () => number
+
+    let foo = 0;
+>foo : number
+>0 : 0
+
+    testLoop: do {
+>testLoop : any
+
+        foo++;
+>foo++ : number
+>foo : number
+
+        continue testLoop;
+>testLoop : any
+
+    } while (function() {
+>function() {        var x = 1;        return false;    }() : boolean
+>function() {        var x = 1;        return false;    } : () => boolean
+
+        var x = 1;
+>x : number
+>1 : 1
+
+        return false;
+>false : false
+
+    }());
+
+    return foo;
+>foo : number
+}

tests/cases/compiler/doWhileUnreachableCode.ts

@@ -0,0 +1,12 @@
+function test() {
+    let foo = 0;
+    testLoop: do {
+        foo++;
+        continue testLoop;
+    } while (function() {
+        var x = 1;
+        return false;
+    }());
+
+    return foo;
+}