How does Ethereum/Solidity handle overflows in contracts?

Question

Say I have a smart contract with variable of type uint256. I write a function to increment this variable.

How does the EVM handle trying to increment the variable to store values beyond 256 bits?

The Solidity docs say the following:

Number literal expressions retain arbitrary precision until they are converted to a non-literal type (i.e. by using them together with a non-literal expression). This means that computations do not overflow and divisions do not truncate in number literal expressions.

So apparently it won't overflow, so what does it do?

Answer 1

Non-literal expressions overflow. I think a 'literal' expression is something like 1223424234. That won't overflow, I suppose, because it won't even compile. A non literal expression (a = 1213232; b = 121231231 -- a and b are really large) will overflow if a+b is larger than largest uint256. At least this is my read.