Mediawiki Error creating thumbnail: Unable to save thumbnail to destination

After installing a mediawiki on our managed server, I found that thumbnails were not displayed in the wiki because there was not a variable pointing to a temp folder were the thumbnails should go defined. I may probably had to enable ImageMagickConvertCommand as well, but not sure. That was my previous LocalSettings.php file:

## To enable image uploads, make sure the 'images' directory
## is writable, then set this to true:
$wgEnableUploads  = true;
#$wgUseImageMagick = false;
#$wgImageMagickConvertCommand = "/usr/bin/convert";

And this is how it looks like after enabling it.

## To enable image uploads, make sure the 'images' directory
## is writable, then set this to true:
$wgEnableUploads  = true;
$wgUseImageMagick = false;
#$wgImageMagickConvertCommand = "/usr/bin/convert";
$wgTmpDirectory = "$IP/images/temp";